Once the Commonwealth enters the capital markets to borrow, it is the Debt Management Department's responsibility to account for that borrowing and schedule its repayment. Bonds require annual payment of interest to investors and when they reach maturity, full repayment of principal.

Managing the state's outstanding debt obligations is a daunting task: the Commonwealth's outstanding debt totals more than $19 billion in principal; with interest payments included, the repayment burden reaches more than $25 billion through 2039. All three of the major credit rating agencies - Fitch Ratings, Moody's Investor Services, and Standard & Poor's - consider Massachusetts to have one of the highest debt-per-capita measures amongst all 50 states.

Debt service is tracked and monitored through the Department's debt databases, and funding for repayment is appropriated through various line-items in the state's annual budget.

The Debt Management Department is responsible for debt service for five different programs:

  • General Obligation Bonds,
  • Special Obligation Revenue Bonds (Gas Tax),
  • Special Obligation Dedicated Tax Revenue Bonds (Convention Center),
  • Federal Highway Grant Anticipation Notes (GANs), and
  • State-Qualified Bond program.


Within these categories of outstanding debt obligations, securities include fixed-rate and variable-rate bonds; lines of credit; refunding escrow agreements; commercial paper; and interest rate hedge agreements. In most cases, the Debt Management Department acts as the paying agent to repay investors both interest and principal as it comes due. The Debt Management Department is also the paying agent for the State-Qualified Bond program pursuant to Chapter 44A of the Massachusetts General Laws. This is a program which provides state assistance to distressed Massachusetts cities/towns/regional school districts to efficiently access the capital markets for their borrowings.

Other Debt Management responsibilities include:

  • Maintaining a process and system to ensure the proper allocation of bond proceeds to capital spending;
  • Ensuring the bonds that are issued continue to meet IRS tax-exemption compliance through their maturity;
  • Calculating federal arbitrage rebate liabilities;
  • Ensuring compliance with the SEC's secondary market disclosure requirements;
  • Maintaining the Commonwealth's primary communication with Wall Street, including the credit rating agencies; and
  • Maintaining investor relations for those institutions or individuals who have chosen to invest in Massachusetts by buying Commonwealth's bonds.



The Debt Management department is committed to improving our services, including what we communicate on our website. We welcome your comments and suggestions for improvements to our web pages. To be notified automatically of future bond sales and other Massachusetts bond investor news, please subscribe to our Debt Management Mailing List.


Last Updated: 10/27/2009


 Disclaimer: The information is provided for quick reference only and is not an exhaustive compilation of information for any particular bond issue. It does not purport to present full and fair disclosure with respect to Commonwealth of Massachusetts debt within the meaning of applicable securities laws.