Budget Issues:

State Practices for Financing Capital Projects

AFMD-89-64: Published: Jul 1, 1989. Publicly Released: Jul 1, 1989.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

GAO reviewed state practices for budgeting and financing capital projects, focusing on the: (1) criteria states used to define capital assets; (2) methods states used to finance capital assets; and (3) extent to which states linked borrowing maturities to the useful life of capital assets.

GAO found that: (1) most of the nine states reviewed had developed strict criteria for determining what constituted capital assets; (2) the states which strictly defined capital assets required that assets have specific value and life expectancy; (3) most states had specific procedures for budgeting for capital assets, but their practices varied; (4) most states, including the nine reviewed, used current revenues and long-term debt financing to finance capital assets; (5) the nine states did not link the financing method and borrowing maturity to capital assets or their useful lives; and (6) most states linked financing methods and borrowing maturity to such direct factors as prevailing market conditions, states' desires to achieve the best economic results, the need to maintain a high quality bond rating, legislative debt limits, and the political environment.

Oct 12, 2017

Sep 20, 2017

May 3, 2017

Jan 18, 2017

Jan 17, 2017

Jan 12, 2017

Dec 20, 2016

Dec 8, 2016

  • budget icon, source: GAO

    State and Local Governments' Fiscal Outlook:

    2016 Update
    GAO-17-213SP: Published: Dec 8, 2016. Publicly Released: Dec 8, 2016.

Dec 1, 2016

Nov 17, 2016

Looking for more? Browse all our products here