SB 1392 – HB 1403
FISCAL NOTE
Fiscal Review Committee
Tennessee General Assembly
March 20, 2025
Fiscal Analyst: Elizabeth Bransford | Email: elizabeth.bransford@capitol.tn.gov | Phone: 615-741-2564
SB 1392 – HB 1403
SUMMARY OF BILL: Authorizes the State of Tennessee, acting by resolution of its
funding board, to issue and sell direct general obligation interest bearing bonds not to exceed
$30,000,000. The proceeds will be allocated to the Tennessee Higher Education Commission for the
purpose of capital outlay and maintenance for institutions of higher education. Authorizes the
Funding Board to issue bond amounts not to exceed 2.5 percent of the amounts specified above for
funding discount and cost of issuance. Authorizes such bonds to be designated as “college savings
bonds”.
FISCAL IMPACT:
STATE GOVERNMENT
EXPENDITURES
First Year Debt Service $3,300,000
Over the Life of the Bonds $48,900,000
Principal $30,000,000
Interest $18,900,000
Assumptions:
• The coupon rate is estimated to be six percent.
• Bonds are issued for a term of 20 years.
• One-twentieth of the principal plus interest will be paid annually.
• Based on current bond market rates, it is estimated that the cost of capital reflected by a six
percent coupon rate will be sufficient for paying actual first-year debt service plus any costs
of issuance.
CERTIFICATION:
The information contained herein is true and correct to the best of my knowledge.
Bojan Savic, Executive Director