Comptroller Seeks Comments On Guidelines For Approval Of Balloon Indebtedness

Thursday, June 19, 2014

The Comptroller of the Treasury, through its Office of State and Local Finance, is seeking comment on proposed  guidelines for Comptroller approval of balloon indebtedness issued by local governments. The guidelines were presented at the State Funding Board meeting held on June 18. 

The board approved the guidelines in substance and requested that the guidelines be subject to public comment through June 27. After all comments have been reviewed by the Comptroller, the Comptroller may declare the guidelines effective July 1; make revisions to the guidelines to be effective July 1; or defer the effective date of July 1 and present the revisions to the board at its next meeting for further review and consideration. 

Pursuant to the provisions of Section 5 of Public Chapter 766, Acts of 2014 (effective July 1), a local government or local government instrumentality must first obtain from the Comptroller approval of the issuance of balloon indebtedness. A "local government" is defined as any incorporated city or town, metropolitan government, county, or utility district. 

“Balloon indebtedness” is defined (with certain exclusions) as debt that: 

(i) Has a final maturity date thirty-one (31) or more years after the date of issuance;

(ii) Delays principal repayment for more than three (3) years after the date of issuance;

(iii) Capitalizes interest beyond the later of the construction period or three (3) years from the

date of issuance; or

(iv) Does not have substantially level or declining debt service. 

The State Funding Board is authorized to establish guidelines with respect to Comptroller approval of balloon indebtedness. 

“It’s important that governments be very transparent to the public when issuing debt, especially when principal repayment is deferred,” Comptroller Justin P. Wilson said. “These guidelines will provide guidance to local governments regarding the information my office needs to properly review proposed transactions. We hope to supplement and update these guidelines in the coming months as we implement this new law. Receiving feedback from the public is an important part of that process.” 

Comments on the proposed revisions to the form should be sent: 

By e-mail to: IGpublic.Finance@cot.tn.gov or 

By mail to: Tennessee State Funding Board

Attn: Ms. Betsy Knotts

17th Floor, James K. Polk Building

505 Deaderick Street

Nashville, TN 37243


CBL & Associates Properties Reports Same-Center Sales Are Up For Second Quarter

CBL & Associates Properties, Inc. announced results for the second quarter ended June 30, including an increase in same-center sales.  CBL's President and Chief Executive Officer Stephen Lebovitz commented, "Overall fundamentals in the CBL portfolio remain healthy. Same-center sales increased 4.1 percent during the second quarter, marking another quarter of impressive ... (click for more)

CBL & Associates Announces $200 Million Share Repurchase Program

CBL & Associates Properties, Inc. Wednesday announced that its board of directors has authorized a share repurchase program for the company to buy up to $200 million of its common stock. The company plans to repurchase shares from time to time on the open market, in privately negotiated transactions or otherwise, depending on market prices and other conditions. Purchases may ... (click for more)

County Taking First Step Toward Replacing County Jail Downtown With Workhouse Addition At Silverdale

County officials are taking the first step toward replacing the long-criticized county jail downtown with an addition at the workhouse at Silverdale. The County Commission is set to approve next Wednesday a $150,000 contract for the PFM government financial consulting firm to begin working out the details. County Mayor Jim Coppinger said he believes the move will save the ... (click for more)

Birchwood Residents Organize To Try To Keep Old School

Birchwood residents have organized to try to keep the old Birchwood School that serves as a community center. Jason Wright, who said he is an alumnus of the school and recently moved his family back home, said the community is concerned over the possibility of the county tearing the school down. He said he was advised that the boiler in the old school has stopped working and ... (click for more)

Chattanooga Strong

The hearts, minds and prayers of Tennesseans, and of the entire nation, have been turned toward Chattanooga this month.  We are sickened and saddened by the senseless tragedy, and we grieve for the families of the five service members who were killed, Gunnery Sgt. Thomas J. Sullivan, Sgt. Carson A. Holmquist, Lance Cpl. Squire “Skip” K. Wells, Staff Sgt. David A. Wyatt and ... (click for more)

Roy Exum: Dr. Palmer, You’re Toast

America is absolutely furious! By 3 o’clock yesterday afternoon there were 36,000 people who had petitioned the White House to extradite Walter Palmer, who is today the most despised man in all of North America. On the Yelp.com website, that promotes his dentistry business in Eden Prairie, Minn, over 6,000 had posted violent, vulgar and vicious notes and, for the record, 60 of them ... (click for more)