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State House Note Program and Other Borrowing Guidelines

Information and instructions for cities, towns, districts and counties interested in issuing debt through the State House Note program or other options.

The State House Note Program is a low cost alternative for the issuance of debt for cities, towns, counties, and districts whereby notes are certified by the Director of Accounts. Established in 1910, this program provides a useful service to municipal issuers, especially the smaller towns and districts. Counties are required to have all of their short-term notes certified by the Director of Accounts. It is optional for cities, towns, and districts. The State House Note Program also assists cities, towns, and districts with their financing needs through the certification of long term note issues known as serial notes.

 

 

Qualified Bond Program

The Qualified Bond Act, MGL Chapter 44A, allows cities, towns and regional school districts to issue general obligation bonds with the state paying the debt service directly from the municipality's or regional school district's local aid. Bonds issued through the program benefit from the strength of the state's credit rating since the payment source is state aid subject to appropriation. This, in turn, results in lower interest rates on debt issuances than what might otherwise be possible if the debt were paid locally.

The State Auditor is the Chair of the Municipal Finance Oversight Board (MFOB). Municipalities or other qualified entities seeking bonds issued through the State Qualified Bond program may submit an application to the State Auditor’s Office.  Application, meeting schedule and other information can be found at the State Auditor’s Office MFOB site.

 

State House Note Forms, Letters and Other Resources

IRS Forms

Whenever a municipality issues notes under the State House Notes program the municipal treasurer or their financial advisor is required to file certain federal tax forms.  Form 8038-G must be filed when notes of $100,000 or more are issued and Form 8038-GC must be files for notes issued that are less than $100,000.

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