19 January 2024- Yesterday, Shapiro Administration Secretary of the Budget Uri Monson released the Commonwealth’s first-ever debt management policy. Debt management policies provide written guidance regarding the authorizations and requirements for issuing debt, guidelines to consider when determining the amount and type of debt to be issued, and guidelines for the management of the debt portfolio, providing the Commonwealth and the public with predictable, consistent policies.
The new policy identifies clear policy goals for the issuance of debt by the Commonwealth within the legal frameworks for issuing Commonwealth new funding and refunding, as well as specific guardrails to ensure that decisions to issue debt are made within a context of fiscal stability and responsibility. Specifically, the new policy outlines how the Commonwealth may issue debt, authorize and issue General Obligation (GO) Bonds, use GO Bond proceeds for capital projects, and more.
The Government Finance Officers Association recommends that “Governments adopt comprehensive written debt management policies that reflect applicable local, state, and federal laws and regulations.” The policy announced yesterday is the first of its kind for the Commonwealth.
Yesterday’s policy announcement is the latest affirmation that Pennsylvania’s economy is strong under Governor Shapiro’s leadership and that his Administration’s sound fiscal management is setting Pennsylvania up for long-term success.
In December, Secretary Monson announced that the Commonwealth conducted a successful bond sale of approximately $1.3 billion in new GO Bonds, saving taxpayers nearly $100 million on debt service savings over the life of the bonds.