Multiple Agencies - Education
An Audit Report on Certification of the Permanent School Fund's Bond Guarantee Program
May 2000
Report Number 00-028
Overall Conclusion
We certify that the amount of bonds guaranteed by the Permanent School Fund's Bond Guarantee Program (Program) is within the limit prescribed by Section 45.053(a) of the Texas Education Code. As of August 31, 1999, the maximum amount allowable for guarantee was $28,281,801,658 and the bonds guaranteed by the Program totaled $17,095,928,584. This certification is required by Section 45.053(b) of the Texas Education Code. The Program was created as a means for school districts to improve the credit rating and marketability of school district bonds.
Key Facts and Findings
According to an analysis performed by Texas Education Agency (Agency) staff, the Program is projected to reach its capacity to guarantee school district bonds between 2003 and 2008. In our opinion, the Program will likely reach capacity in 2004. It appears that legislative action is not required at this time. However, the situation should be monitored and action taken if needed. Periodic monitoring is important, considering the high growth rate in school districts' bonded debt in the past few years.
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