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FOR IMMEDIATE RELEASE

Treasurer Janet Cowell Releases 2016 Debt Affordability Study
 
Raleigh, N.C. – State Treasurer Janet Cowell announced today the results of the 2016 Debt Affordability Study, advising the Governor and the General Assembly on the estimated debt capacity of the General, Highway and Highway Trust Funds for the upcoming ten fiscal years.
 
The annual study, approved by the Debt Affordability Advisory Committee, provides analysis of the impact of future debt issuance on the State's fiscal position. The General Fund has capacity of nearly $210 million for each of the next 10 years. The combined debt capacity of the Highway Fund and the Highway Trust Fund is approximately $1.131 billion for the current fiscal year. The analysis incorporates the proposed issuance of the Connect NC Bond package, pending approval by the voters on March 15, 2016.
 
“This report is of elevated importance this year as voters consider approval of the Connect NC Bonds,” said Treasurer Cowell. “Our findings demonstrate that North Carolina has maintained a conservative posture on debt and has the ability to responsibly invest in its future—and keep the ‘AAA’ bond ratings if the Connect NC bonds are approved.”
 
Additionally, the Committee is charged with providing policy recommendations in alignment with the sound management of the State’s debt. The Committee emphasized centralized debt authorization and management. Other highlighted recommendations include the use of General Obligation Bonds as the preferred, but not exclusive,  financing vehicle for the State’s capital projects and maintenance of structural budget balance.
 
The State’s “AAA” bond rating has been reaffirmed by all three major national rating agencies. Currently, all of the State’s debt ratios remain below the median levels for the State’s peer group composed of all nine states rated “AAA” by all three rating agencies. In affirming the State’s rating, Fitch stated that a key rating driver for North Carolina is “a low–to-moderate debt burden and strong debt management practices including an affordability planning process.”
 
The 2016 Debt Affordability Study was prepared by the staff of the State and Local Government Finance Division of the Department of State Treasurer and approved by the Debt Affordability Advisory Committee, which was created by the General Assembly in 2004 and is chaired by Treasurer Cowell.
 
Other committee members are Lyons Gray, Secretary of Revenue; Linda Combs, State Controller; Lee Roberts, State Budget Director; Beth Wood, State Auditor; Frank Aikmus, Senate Appointee; Bradford Briner, Senate Appointee; Tom Turner, House Appointee; and Gene Chianelli, House Appointee.
 
View the 2016 Debt Affordability Study
 
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The Department of State Treasurer’s State and Local Government Finance Division handles the sale and delivery of all State and local debt and monitors the repayment of State and local government debt. More information can be found at http://www.nctreasurer.com/slg