State of Georgia debt management plan 2023-2027

DEBT MANAGEMENT PLAN
2023 - 2027
GOVERNOR BRIAN P. KEMP

STATE OF GEORGIA DEBT MANAGEMENT PLAN
FISCAL YEAR 2023 FISCAL YEAR 2027
Georgia State Financing and Investment Commission

Georgia State Financing and Investment Commission
Members
GOVERNOR BRIAN P. KEMP - Chairman
LIEUTENANT GOVERNOR BURT JONES - Vice Chairman
STATE AUDITOR GREG S. GRIFFIN Secretary/Treasurer
SPEAKER OF THE HOUSE OF REPRESENTATIVES JON G. BURNS
ATTORNEY GENERAL CHRISTOPHER M. CARR
COMMISSIONER OF AGRICULTURE TYLER HARPER
STATE TREASURER STEVE McCOY
Construction Division Director MARTY W. SMITH Executive Secretary to the Commission
Financing and Investment Division Director DIANA POPE

STATE OF GEORGIA DEBT MANAGEMENT PLAN FISCAL YEAR 2023 FISCAL YEAR 2027
TABLE OF CONTENTS
Executive Summary..................................................................................1 Constitutional and Statutory Framework for State Debt.....................................2 Types of Debt Obligations ..........................................................................5 Other Long-Term Obligations.....................................................................13 Debt Structure........................................................................................16 Debt Affordability ..................................................................................16 Conclusion ............................................................................................29 Tables Summary of Projected Debt Ratios (GO Bonds and GR Bonds)...............................30 Summary of Projected Debt Ratios (GO Bonds, GR Bonds, and GARVEEs) ..............31
Appendix A: State of Georgia General Obligation Bonds and Guaranteed Revenue Bonds Debt Service Schedules
Appendix B: State Authority Debt Service Schedules (as of June 30, 2022) Georgia Higher Education Facilities Authority ..............................................B-1 Georgia Housing and Finance Authority ......................................................B-2 Lake Lanier Islands Development Authority ..................................................B-3 Georgia Ports Authority.........................................................................B-4 State Road and Tollway Authority.............................................................B-5 Georgia World Congress Center Authority ...................................................B-6

STATE OF GEORGIA DEBT MANAGEMENT PLAN FISCAL YEAR 2023 FISCAL YEAR 2027
EXECUTIVE SUMMARY
Each year, the Financing and Investment Division of the Georgia State Financing and Investment Commission (the Commission) prepares the debt management plan (the Plan) which provides projections of the State of Georgia's general obligation (GO) and guaranteed revenue (GR) debt (principal amount) and the annual debt service requirements (principal and interest due to be paid during a fiscal year). The Plan covers the current fiscal year and the four succeeding fiscal years. The resulting projected annual debt service requirements are compared to the treasury receipts of the State for the immediately preceding fiscal year, to determine the ratio of highest annual debt service (HADS) requirements to the prior year's State treasury receipts. This ratio, which is established by the Constitution of the State at a maximum of 10%, but for reasons discussed within the Plan is limited by Commission policy to a maximum of 7%, along with several other ratios discussed in the Plan, informs the General Assembly in their consideration of the authorization of new State general obligation and guaranteed revenue bond debt during the annual appropriations process. Projected authorizations of new debt may be increased or decreased depending on the capital needs of the State and projections of estimated treasury receipts in future years.
The following table shows actual (Fiscal Year (FY) 2018 FY 2022) and projected (FY 2023 FY 2027) authorizations for GO debt and GR debt for capital projects, bond issuances for each fiscal year and the resulting ratio of combined annual GO and GR debt service to prior year State treasury receipts. To the extent there are any unused authorizations carried over from prior fiscal years, the amount of bonds issued in a fiscal year may exceed the amount of new authorizations for that fiscal year by up to the carryover amount. The approximately $938.9 million of general obligation debt authorized for FY 2023 addressed capital needs for education (K-12 needs and higher education facilities for the University System of Georgia (USG) and the Technical College System of Georgia (TCSG)), correctional infrastructure transformation, and various improvements to facilities of the State including parks, public safety, and economic development.
The planning level for new GO debt authorizations is $800 million, beginning with FY 2024. No additional new authorizations for GR debt are projected during the planning period; however, it currently is expected the unissued FY 2022 authorization of GR debt will be issued during FY 2026. The HADS ratios shown in the following table are based on the actual or scheduled debt service payments for all currently outstanding GO bonds and GR bonds plus the projected debt service appropriations for new debt authorizations.
(Table shown on following page.)
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$ - Millions

Fiscal Year

2018

New GO Authorizations

$1,166

GO

Authorizations 1,155

Issued

New GR

Authorizations

GR

Authorizations

Issued

HADS Ratio

(Highest annual debt service to Prior Year State Treasury Receipts)

5.5%

*As of January 3, 2023

Actual Amounts 2019 2020 2021 $1,184 $1,096 $1,129 1,320 997 1,139
5.1% 4.9% 4.7%

2022 $983 1,139 567 367
4.1%

2023 $939 754
3.7%

Projected Amounts* 2024 2025 2026 $800 $800 $800 1,157 800 800
200 4.3% 4.3% 4.2%

2027 $800 800
4.1%

Various State authorities are authorized by State law to transact multi-year debt obligations which are secured by revenues of the authority; however, these obligations are not included in the debt service ratio as defined in the Constitution. The act creating the Commission established the Commission as having final authority to authorize the issuance of any new debt by State authorities and in setting the parameters for the incurring of that debt. These debt obligations, which are backed only by the designated revenues, are commitments of the issuing State Authority only; there is no legal recourse to the State for repayment of the obligations. The obligations of State authorities are discussed in more detail in a later section of this Plan.

There are other types of multi-year debt obligations, which even though they do not meet Georgia's constitutional definition of debt, generally are considered by the credit markets and rating agencies as de facto debt of the State (or the USG) and thus that debt does have credit rating implications for the State. The two primary types of such obligations are (1) lease obligations of State agencies and (2) the debt of foundations and cooperative organizations associated with the USG and its various institutions. In compliance with various Statements of the Governmental Accounting Standards Board (GASB), these obligations are reflected in the State's Annual Comprehensive Financial Report and are discussed later in the Plan.

CONSTITUTIONAL AND STATUTORY FRAMEWORK FOR STATE DEBT
Prior to 1973, the State was not permitted to issue either GO or GR debt instead, the State's capital project needs were met through the issuance of revenue bonds by several State authorities with the security for those bonds being annually renewable lease/rental agreements between the issuing authority and one or more State departments and/or agencies. (The structure described in the preceding sentence is commonly referred to as appropriation debt.) In November 1972 the electorate of the State approved a comprehensive amendment to the Constitution (the 1972 Amendment) which took effect January 1, 1973, which permitted the State to finance its capital project needs directly through the incurring of GO debt and GR debt, both of which are secured by the full faith and credit of the State. The 1972 Amendment also included a prohibition against the State entering into any new lease/rental agreements if those agreements would serve as security for financings by State authorities or other public institutions. With the passage of the 1972
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Amendment and the subsequent statutory implementation of the 1972 Amendment by the General Assembly in 1973 through the enactment of the Georgia State Financing and Investment Commission Act (the Commission Act), the State was granted the ability to incur legally binding GO and GR debt. The ability to incur GO and GR debt enabled the State to achieve higher credit ratings for its debt and thus lower interest rates than the appropriation debt method described above. The State's first issue of GO bonds subsequent to the 1972 Amendment was in September 1974 with the issuance of $20 million series 1974A bonds. At that time, there also was an aggregate outstanding amount of approximately $1.052 billion in State authority debt secured by leases with State agencies and departments, but that debt since has been paid in full.
With the ratification of a new Constitution in 1983, the ratio of maximum fiscal year GO and GR debt service to prior year State treasury receipts was lowered to 10% from its initial level of 15%. The Constitution and the Commission Act establishing the parameters regarding the issuance of GO and GR debt form a solid foundation supporting the highest possible ratings which have been assigned by the bond rating agencies to the State's debt, and the credit markets' high regard of the State's debt. Some of the key provisions of the Constitution and the Commission Act include:
a prohibition against incurring additional debt (either via issuance of GO bonds or GR bonds) which would cause the highest aggregate annual debt service in the then current year or any subsequent year to exceed 10% of the total State treasury receipts for the fiscal year preceding the issuance of the additional debt;
explicit descriptions of the types of capital projects which can be funded with GO and GR debt;
a requirement that the maximum annual debt service for proposed new debt be appropriated at the time the debt is authorized;
a requirement for full appropriation each fiscal year of the amount necessary to pay the aggregate debt service coming due for that year;
a provision that debt service appropriations for new debt authorizations which were not issued do not lapse at the end of the fiscal year in which they were authorized;
a provision for repeal, prior to the incurring of the debt, of GO and GR debt authorizations by the General Assembly;
guidelines as to how GO and GR debt may be refunded to ensure that there is no incremental increase in debt service in any future year and to prohibit the extension (final maturity) of the debt as a result of the refunding;
limitations on cash flow borrowing for operating budget purposes; a prohibition against the issuance of any new Authority debt which would be secured by
lease agreements with State agencies or departments, as had been utilized extensively by the State prior to the 1972 Amendment; a provision that should the amount appropriated for debt service payments be insufficient for any reason to make all payments due with respect to GO debt the first revenues thereafter received in the general fund of the State must be set aside to the extent necessary to cure any such payment deficiency; an explicit right established by the Constitution for any GO debt holder to bring suit, if necessary, to compel the appropriate state fiscal officer to meet the obligation to set aside the first revenues received after a determination that insufficient funds have been set aside for payment of all payments due with respect to GO debt of the State;
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guidelines as to the issuance of GR debt including a requirement that there be a debt service reserve funded at the time the debt is incurred in an amount equal to the highest annual debt service amount for that debt, and provisions for the replenishment of that reserve from state treasury receipts should there ever be a need to utilize any of the funds within the reserve for payment of debt service, and
an explicit right established by the Constitution for any GR debt holder to bring suit, if necessary, to compel the appropriate state fiscal officer to meet the obligation to apply funds to the common reserve fund per the requirements of the Constitution.
The issuance of all State debt, and debt issued by State authorities, is subject to Commission approval unless there is a statutory exception. The Commission is comprised of seven members, all of whom serve in an ex-officio capacity with the three officer designations as established in the Constitution: the Governor of the State serves as Chairman, the President of the Georgia State Senate (the Lieutenant Governor) serves as Vice-Chairman, and the State Auditor serves as Secretary and Treasurer. Other members of the Commission are the Attorney General, the Commissioner of Agriculture, the Speaker of the House of Representatives, and the State Treasurer.
Pursuant to the Constitution and the Commission Act, the Commission is charged with the following responsibilities:
the issuance of all public debt of the State, the proper application of the proceeds of such debt to the purposes for which it is incurred, the investment of all proceeds to be administered by the Commission, providing debt related financial advisory services to State authorities and agencies, providing construction services for State agencies for GO debt funded projects, and additional responsibilities as provided by law.
In summary, the Constitution provides for the issuance, and limitations and conditions thereon, by the State of both GO debt and GR debt, and establishes that the full faith, credit, and taxing power of the State is pledged to the repayment of both of these types of public debt. During the legislative session each year as part of the budget appropriations process, the General Assembly may authorize new GO debt to be issued by the State and/or GR debt to be issued by various State authorities; the Governor may approve or veto individual debt authorizations included in the appropriations bill. The Constitution also provides for the issuance of revenue debt which may be issued by certain State authorities as authorized by State statute; such non-guaranteed revenue debt cannot be secured by the full faith, credit, and taxing power of the State, but instead must be secured only by specified revenues of the Authority pursuant to the Act creating and governing the Authority.
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TYPES OF DEBT OBLIGATIONS
General Obligation Debt
The Constitution limits the use of GO debt to the following purposes:
to acquire, construct, develop, extend, enlarge, or improve land, waters, property, highways, buildings, structures, equipment, or facilities of the State, its agencies, departments, institutions, and of certain State authorities;
to provide educational facilities for county and independent school systems and for public library facilities for county and independent school systems, counties, municipalities, and boards of trustees of public libraries or boards of trustees of public library systems; and,
to make loans to counties, municipal corporations, political subdivisions, local authorities, and other local government entities for water or sewerage facilities or systems, or for regional or multi-jurisdictional solid waste recycling or solid waste facilities or systems.
For the first two purposes described above, the State Constitution limits the term of GO debt to 25 years. As a matter of practice, however, the General Assembly typically approves the issuance of GO debt with a final maturity of not more than 240 months (20 years) from the date that the debt is incurred for major construction and renovation projects, or for a shorter final maturity (generally 60 months) for less extensive repair projects and capital equipment needs; this is done so the term of the debt does not exceed the useful life of the specific projects and equipment being funded.
The following chart depicts the net GO debt authorized for the period FY 2013 through FY 2023 (net GO debt is equal to original authorizations less any deauthorizations by the General Assembly prior to the debt being incurred). As part of its active and responsive financial management of the budget in response to the decline in State revenues during and after the end of the 2007-2009 recession, the State reduced the amount of new authorizations for GO debt as compared to preceding years to only the most critical infrastructure projects in order to help bring the various debt ratios back within planning limits sooner rather than later. As State revenues slowly recovered after that recession, new debt authorizations also were returned to more normal levels. The COVID-19 Recession in 2020, which officially lasted only two months and was quite deep based on many metrics of measurement, did not result in as severe of a drop of State revenues, or for an extended duration as did the 2007-2009 recession, and thus did not require the same level of response with respect to reducing new debt authorizations.
(Chart shown on following page.)
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Millions $1,300

FY 2013 - FY 2023 General Obligation Debt Net Authorizations

$1,200 $1,100 $1,000
$900 $800 $700

$750

$847

$865

$1,097

$949

$1,166

$1,184

$1,096

$1,129

$983

$939

$600

$500 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023

GO debt may be incurred only if the General Assembly first enacts legislation as part of the annual appropriations bill or the amended annual appropriations bill which states the purpose(s), in either general or specific terms, for the debt; also, the bill must specify the authorized maximum principal amount of the debt and appropriate funds for the maximum annual debt service requirement to fully amortize such debt within the specified time frame. The Governor may approve or veto debt authorizations on an individual basis as part of signing the appropriations bill legislation into law. Authorizations for debt and the appropriations made for payment of debt service on that debt do not lapse at the end of the fiscal year even if the debt is not incurred and continue in effect until either the debt for which the appropriation was authorized has been incurred, or the authorization has been repealed by the General Assembly and such repeal subsequently is enacted into law by the Governor, or otherwise becomes law without the signature of the Governor. The following chart illustrates how the GO net debt authorizations in aggregate of approximately $11.006 billion during the FY 2013 through FY 2023 period were distributed among major functions and programs of the State.

FY 2013 - FY 2023 General Obligation Debt Net Authorizations by Program

2% 1% 6%

Higher Education

2%

36%

K-12 Education

10%

Transportation 9%
Economic Development

Public Safety

Water & Sewer

Ports

9%

Healthcare Facilities

Other

26%

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The Constitution requires that each fiscal year the appropriations for debt service payments on all GO debt be made to a special trust fund which is designated as the State of Georgia General Obligation Debt Sinking Fund (the sinking fund). The amount to be appropriated to the sinking fund must be sufficient to pay that year's debt service on all outstanding GO debt plus the maximum annual debt service requirement on all authorized but unissued debt.
As a further safeguard against there being any shortage in the sinking fund necessary to make all required debt service payments, the Constitution provides that should the General Assembly fail to make sufficient appropriation to the sinking fund as described above, or if for any reason the amount in the sinking fund is insufficient to make all required debt service payments during the fiscal year, the first revenues thereafter received in the general fund of the State, to the extent necessary to cure the deficiency, are to be set aside and deposited into the sinking fund by the appropriate fiscal officer.
As of June 30, 2022, there was approximately $9.794 billion of GO debt outstanding (see Appendix A, page A-1). In July 2022, the State funded over $753 million of GO bond authorizations leaving approximately $357 million of GO debt authorizations available for future issuances. The net effect of these transactions, together with scheduled principal payments and early retirements which were made from July 1, 2022 through December 31, 2022, was that as of December 31, 2022 the total GO debt outstanding had increased to approximately $9.839 billion. As of the date of this Plan, there are no plans for additional issuance of GO bonds for the remainder of FY 2023.
The following chart depicts the annual debt service on all currently outstanding GO debt plus the projected annual debt service on the debt currently authorized but not yet incurred, as well as projected future new debt authorizations annually of $800 million, beginning with FY 2024.

Millions $1,600

FY 2023 - FY 2043 General Obligation Bonds - Issued and Projected Debt Service

$1,400

$1,200

$1,000

$800

$600

$400

$200

$0 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043

Principal (Issued Bonds Only - as of 12/31/2022) Debt Service for FY 2024 - FY 2027 Projected Issuances

Interest (Issued Bonds Only - as of 12/31/2022) Debt Service for FY 2028 - FY 2043 Projected Issuances

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Guaranteed Revenue Debt
GR debt is revenue debt issued by a State authority for which the State, via the legislative process, has guaranteed the repayment of the debt. The Constitution limits the use of GR debt to the following purposes:
toll bridges or toll roads, land-based public transportation facilities or systems, water facilities or systems, sewage facilities or systems, loans to, and loan programs for, citizens of the State for educational purposes, and regional or multi-jurisdictional solid waste recycling or solid waste facilities or systems.
The amount of GR debt which may be issued to fund water or sewage treatment facilities or systems is limited by the Constitution as follows:
"No guaranteed revenue debt may be incurred to finance water or sewage treatment facilities or systems when the highest annual debt service requirements for the then current year or any subsequent fiscal year of the State for outstanding or proposed guaranteed revenue debt for water facilities or systems or sewage facilities or systems exceed 1 percent of the total revenue receipts less refunds of the State treasury in the fiscal year immediately preceding the year in which any such debt is to be incurred."
There also is a limit on the amount of GR debt for educational purposes:
"The aggregate amount of guaranteed revenue debt incurred to make loans for educational purposes that may be outstanding at any time shall not exceed $18 million, and the aggregate amount of guaranteed revenue debt incurred to purchase, or lend or deposit against the security of, loans for educational purposes that may be outstanding at any time shall not exceed $72 million."
Prior to incurring GR debt, legislation must be enacted by the General Assembly and signed into law by the Governor authorizing the guarantee of the proposed debt obligation. In the legislation, which generally is part of the annual appropriations bill for the State, the General Assembly must determine conclusively that such obligations will be self-liquidating over the life of the obligation, specify the maximum principal amount of such obligation, and appropriate an amount at least equal to the highest annual debt service requirement for the obligation which must be deposited into a special trust fund designated as the State of Georgia Guaranteed Revenue Debt Common Reserve Fund (the common reserve fund) at the time the GR debt is incurred. The common reserve fund provides a reserve for debt service payments pursuant to the State guarantee(s) made in connection with each GR debt obligation. Appropriations of the maximum annual debt service made for the benefit of GR debt do not lapse for any reason and the appropriations continue in effect until the debt for which such appropriation was authorized has been incurred. The authorization and appropriation of debt service may be repealed provided such repeal occurs prior to the debt being incurred and payment made into the common reserve fund for the highest annual debt service requirement of the debt.
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If the revenue pledged to the payment of the GR debt is not sufficient to meet the debt service requirement and any portion of the debt service payment is required to be made utilizing funds in the common reserve fund, the Constitution mandates that the common reserve fund must be reimbursed from the State's general funds within ten (10) days after the start of the next fiscal year to restore the common reserve fund to the required amount. The requirement to reimburse the common reserve fund for any such payment is subordinate only to the obligation to make sinking fund deposits for the payment of GO debt.
The Constitution requires that the amount to the credit of the common reserve fund must at all times be at least equal to the aggregate highest annual debt service requirements for each outstanding GR bond series; the Constitution also provides that any excess funding in the common reserve fund at fiscal year-end is to be transferred to the State's general fund.
As of June 30, 2022, there was a total of $409.295 million of GR debt outstanding (see Appendix A, page A-2) with a common reserve fund requirement of $49.515 million; all outstanding GR debt was issued by the State Road and Tollway Authority (SRTA). The final 2011B refunding bonds principal payment which was made on October 1, 2022 reduced the total principal amount of GR debt outstanding to $386.645 million as of December 31, 2022; the final 2016 refunding bonds principal payment will be made during fiscal year 2024 on October 1, 2023, which will leave only the 2021 GR bonds outstanding. As of the date of this Plan, SRTA expects it will issue the remaining available authorization of $199.62 million during fiscal year 2026.
The following chart shows the annual debt service for all currently outstanding GR debt for the period FY 2023 through FY 2052 (FY 2052 is the last year of debt service for the currently outstanding GR bonds). The chart also shows the required amount for the guaranteed debt common reserve fund.

Millions $50 $45 $40 $35 $30 $25 $20 $15 $10
$5 $0

Guaranteed Revenue Outstanding Debt Service as of June 30, 2022
SRTA Series 2021A and 2021B SRTA Series 2011B and 2016 Refunding Guaranteed Debt Common Reserve Requirement

Millions

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Refunding Opportunities
To ensure that the debt service on the State's outstanding debt is minimized, the Financing and Investment Division continuously monitors market conditions to determine if any outstanding debt could be refunded and thereby reduce future debt service payments. Refunding bond issues must comply with the requirements of the Constitution, the Commission Act, and the Commission's official policies which include: refunding debt may not extend the term beyond the term of the refunded debt; refunding debt may not increase debt service in any fiscal year; refunding debt should produce minimum present value debt service savings of 3% for a current refunding or 4% minimum present value debt service savings for an advance refunding. (Note: the terms "current refunding" and "advance refunding" are references to specific federal tax law definitions for two different refunding structures; current refundings can be federally tax-exempt; however, advance refundings are prohibited from tax-exempt issuances under the current federal tax regulations.) The minimum present value percentages can be waived should the Commission deem that to be appropriate for the circumstances. There are additional restrictions imposed by federal regulations for the refunding debt to be tax-exempt debt for federal income tax purposes. The dramatic increase in interest rates during calendar year 2022, with even more increases possible in calendar year 2023, is expected to reduce refunding opportunities in the near term.
Authority Debt
Certain state authorities are authorized by statute to issue revenue bonds for various revenueproducing undertakings. Since such revenue debt incurred by state authorities is typically not taxsupported and there is no State guarantee regarding payment of the debt service (except in the case of the previously described GR debt obligations), the issuance of such debt by state authorities does not directly impact the State's debt burden or debt capacity. Unless specifically exempted by its statute, Commission approval is required before any authority debt can be incurred, including any line(s) of credit for operating cash flow purposes. Following is a brief summary of those state authorities which have revenue bonds or other debt obligations currently outstanding. Unless noted otherwise, all figures are as of June 30, 2022, with the outstanding amounts updated as of December 31, 2022. (See Appendix B for authority debt service schedules as of June 30, 2022.)
The Georgia Higher Education Facilities Authority (GHEFA) is authorized to incur debt to finance self-liquidating capital projects for the USG and the TCSG; GHEFA is authorized by statute to have outstanding at any point in time a maximum debt of $500 million. GHEFA issued revenue bonds in 2008, 2009, and 2010 which financed a total of eighteen projects at thirteen separate USG institutions; all of the original bonds have been subsequently refunded or defeased and only the three series of refunding bonds issued in 2015, 2019, and 2020 currently are outstanding. As of June 30, 2022, the aggregate principal amount of outstanding GHEFA bonds was $170.45 million - no additional bonds matured between then and December 31, 2022 and thus the balance outstanding remained $170.45 million.
The Georgia Housing and Finance Authority (GHFA) is authorized to issue bonds and notes for the purpose of facilitating economic development including the underwriting or purchase of single-family residential mortgages; the improvement of public health, safety, and welfare; and for other public purposes, including healthcare services. By statute, GHFA may have a maximum aggregate amount of bonds and notes outstanding at any -10-

point in time of $3 billion for GHFA's single family residential housing program, excluding refunding bonds and notes. As of June 30, 2022, GHFA had approximately $1.451 billion bonds outstanding, all of which were for its single-family residential housing program. GHFA has made additional principal redemptions of $56.595 million during the second half of calendar year 2022; as of December 31, 2022, GHFA's total outstanding bonds amount was approximately $1.395 billion. At its December 19, 2022 meeting, the Commission authorized GHFA to issue up to $250 million of new money or refunding bonds during calendar year 2023 for its single-family residential mortgage loans program.
The Lake Lanier Islands Development Authority (LLIDA) is authorized to issue revenue bonds and borrow money (no debt limit is specified in the LLIDA Act) for the purpose of improving, developing, and promoting the islands in Lake Lanier as a recreational and convention location. In 2008, LLIDA issued $10 million revenue bonds for roadway and other capital improvements; it also borrowed approximately $15.141 million from Georgia Environmental Financing Authority (GEFA) to make improvements to its sewerage system (the interest rate on the 2008 GEFA loan was reduced in 2019). In November 2021, GEFA and LLIDA entered into an agreement for GEFA to provide funding for a sewer force-main improvement project; this project is expected to be completed in early 2023 at a cost of approximately $4.1 million. As of June 30, 2022, LLIDA had a combined total of approximately $9.110 million principal outstanding; as of December 31, 2022, scheduled principal repayments reduced the outstanding balance to approximately $8.234 million (amounts do not yet include any of the principal amount loaned to date by GEFA for the sewer force-main improvement project).
The Georgia Ports Authority (GPA) is authorized to incur debt for projects which are self-liquidating in accordance with the Georgia Ports Authority Act creating GPA; there is no specified limit as to the total amount of debt GPA is permitted to incur. In November 2021 GPA issued its 2021 revenue bonds in the amount of $427.04 million for the purpose of funding improvements and expansions at the Port of Savannah. As of June 30, 2022, GPA had $422.45 million of the 2021 bonds outstanding. In August 2022 GPA issued $755.615 million additional bonds on parity with the 2021 bonds to fund approximately $850 million of additional projects at the Port of Savannah. The aggregate amount of GPA revenue bonds outstanding as of December 31, 2022 was approximately $1.178 billion.
The State Road and Tollway Authority (SRTA) is authorized to issue revenue bonds (no debt limit is specified in the SRTA Act) for self-liquidating land public transportation systems (roads, bridges, etc.) and projects. As of June 30, 2022, the aggregate amount of SRTA bonds outstanding was approximately $862 million, consisting of both GR Bonds and GARVEE Bonds as described below. As of December 31, 2022, scheduled principal payments had reduced the aggregate amount of outstanding SRTA bonds to approximately $839 million.
Guaranteed Revenue Bonds. In July 2021 SRTA issued $367.38 million (of the $567 million authorized by the General Assembly in the FY 2022 appropriations bill) of 2021 GR Bonds; when aggregated with the then outstanding 2011B and 2016 refunding GR bonds, the total amount of GR bonds outstanding increased to $430.84 million. Scheduled principal payments during FY 2022 reduced the total amount of outstanding GR bonds to $409.295 million as of June 30, 2022. The issuance of the 2021 GR bonds leaves $199.62 million unused GR debt authorization, which SRTA currently does not anticipate issuing
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until FY 2026. After the final maturity payment for the 2011B refunding bonds on October 1, 2022, as of December 31, 2022, the total amount of GR bonds outstanding was $386.645 million.
Grant Anticipation Revenue Vehicle (GARVEE) Bonds. As of June 30, 2022, SRTA had an aggregate outstanding amount of GARVEE bonds (described in more detail in the following GARVEE Bonds section) of $452.655 million. There were no scheduled payments of principal between June 30, 2022 and December 31, 2022; therefore, the aggregate amount of outstanding GARVEE bonds remained $452.655 million as of December 31, 2022. SRTA currently does not anticipate issuing additional GARVEE bonds during the Plan period.
Public-Private Partnership (P3) Obligations. SRTA is authorized to enter into P3 contracts to fund transportation projects for the State. These obligations are not included in the debt service coverage ratio as defined by the Constitution, but the rating agencies may incorporate outstanding obligations related to P3 transactions in their calculations of total net tax-supported debt. As discussed on page 24, Moody's inclusion of P3 debt is based on the higher of the liability in the government's financial statement or the size of the government's termination payment obligation. As of June 30, 2022, the outstanding amount for SRTA's P3 obligations was approximately $165 million (for the I-285 at SR 400 project); payments are secured by state motor fuel tax revenues, and the final payment is scheduled for late 2023/early 2024. SRTA and GDOT are currently working on a much larger P3 transaction to fund the SR 400 Express Lanes project; this project is one of GDOT's initial Major Mobility Investment program projects, is expected to be supported by toll revenues and delivered as a revenue risk, design build finance and maintain P3 contract with a 50-year operations and maintenance term. Developer selection is anticipated to be made in August 2023 with construction commencing in 2024/2025. Amounts related to P3 transactions are not included in the schedules in Appendix B.
The Georgia World Congress Center Authority (GWCCA) is authorized by statute to have outstanding no more than $500 million revenue bonds for multi-purpose stadiums and coliseums and certain ancillary facilities at any time. In April 2021, GWCCA issued a total of $439.595 million in Convention Center Hotel Revenue Bonds to finance the development of a new Authority-owned hotel with additional convention facilities on GWCCA property adjoining its multi-use stadium facility in Atlanta. As none of GWCCA's currently outstanding bonds mature prior to FY 2027, the outstanding amount remains $439.595 million as of December 31, 2022.
GARVEE Debt
In 2006, SRTA established a structure for the GARVEE bonds as consisting of two separate series, one described as Federal Highway Grant Anticipation Revenue Bonds and the other described as Federal Highway Reimbursement Revenue Bonds at an 80/20 ratio, respectively, with a final maturity of approximately 12 years from the date issued. The master trust indenture for the GARVEE bonds established an additional bonds test requiring that the amount of Federal Obligation Authority available must be equal to at least 3.0 times the maximum annual debt service on all outstanding and any proposed GARVEE debt when the proposed bonds are to be issued on parity with the outstanding debt. SRTA's GARVEE bonds are secured solely from federal highway grant revenues and reimbursements and they do not have any legal claim to the full faith and credit
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of the State; thus, they are not GO debt nor GR debt of the State and are not included in the debt service coverage ratio as defined by the Constitution. As of December 31, 2022, there was an aggregate of $452.655 million GARVEE bonds outstanding.

The following table summarizes the debt service requirements on the outstanding GARVEE bonds, the most recent Projected Federal Obligation Authority available for debt service, and the resulting debt service coverage factors. Estimated total federal reimbursements are expected to be lower, as shown in the table on page 30; these amounts are included in the calculation of annual debt service to prior year revenues.

$ - Millions
Debt Service Requirements Outstanding Debt Projected Federal Obligation Authority Debt Service Coverage (Debt Service as a % of Projected Federal Obligation Authority)

FY 2023 $60.432

FY 2024 $60.446

FY 2025 $60.442

FY 2026 $60.442

FY 2027 $60.439

$1,574.137 $1,605.620 $1,637.732 $1,670.487 $1,703.897

26.0x

26.6x

27.1x

27.6x

28.2x

With respect to calculations of net tax-supported debt, both Moody's and Fitch include GARVEE debt (with a corresponding allowance granted for the federal revenue sources which support the debt) in their calculations. As shown in the table on page 30, including GARVEE bonds and corresponding federal revenue sources which support the debt in the debt ratio calculations results in a slight increase in the State's overall debt burden. The ratio of debt service requirements to the prior year's State treasury receipts plus federal reimbursements is projected at 3.7% in FY 2023, 4.3% in FY 2024, 4.3% in FY 2025, 4.2% in FY 2026, and 4.1% in FY 2027; these percentages are well below the planning level limit of 8% inclusive of the GARVEE debt as established in the Plan.

OTHER LONG-TERM OBLIGATIONS
Multiyear Contracts for Energy Efficiency Projects
In November 2010, an amendment to the Constitution to provide for multiyear contracts for energy efficiency or conservation improvement projects (the 2010 Amendment) was approved by the electorate of the State. The 2010 Amendment allowed the General Assembly, through adoption of general law (2010 General Assembly Senate Bill 194, effective January 1, 2011), to authorize state governmental entities to incur debt for the purpose of entering into multiyear contracts for governmental energy efficiency or conservation improvement projects in which the vendors guarantee that debt service payments for the energy efficiency improvements will be offset fully by specified savings or revenue gains attributable solely to the improvements. Senate Bill 194 also required the Commission to adopt fiscal policies and establish a total multiyear contract value for such contracts and further provided any contract entered into by a state agency not in compliance with the policies and multiyear contract value authority set by the Commission would be void and of no effect. A total of $79.9 million in contracts have been executed, with the last debt service payment due in fiscal year 2033. While the debt service amount is not required to be included in the calculation of the debt service ratio previously discussed in the Plan, and it is neither GO debt
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nor GR debt of the State, the Commission has determined to make such calculations to ensure that conservative debt affordability standards are maintained for all State debt. The energy project multiyear contracts are recorded as Notes Payable on the financial statements of the State.
Multiyear Contracts for Real Property Leases
In November 2012, an amendment to the Constitution to provide for multiyear rental agreements for real property (the 2012 Amendment) was approved by the electorate of the State. The 2012 Amendment allowed the General Assembly, through adoption of general law (2012 General Assembly Senate Bill 37, effective January 1, 2013), to authorize certain State agencies the State Properties Commission (SPC) and the Board of Regents (BOR) - to enter into multiyear rental agreements, without obligating funds for the total amount of the obligation that the State will bear under the full term of such agreements, provided the Commission has adopted fiscal policies and established total multiyear contract value authority for the current and future fiscal years. The Commission adopted the requisite fiscal policies at its December 12, 2012 meeting. Although the debt service amount for the multiyear rental agreement contract value authority is not required to be included in the calculation of the debt service ratio previously discussed in the Plan, nor can it be construed as general obligation debt or guaranteed revenue debt of the State, the Commission has determined to make such calculations to ensure that conservative debt affordability standards are maintained. Various accounting rules and standards dictate that the multiyear real property rental agreements are considered leases on the financial statements of the State (see "OTHER LONG-TERM OBLIGATIONS Leases" below).
Through FY 2022 SPC and BOR had closed on an aggregate of approximately $901.6 million of multiyear rental agreements per authorizations approved by the Commission. For BOR, the Commission authorized $10 million multiyear contract value authority for FY 2023, although BOR had not closed on any new leases as of December 31, 2022. For FY 2023 through December 31, 2022, SPC had closed on approximately $13.7 million of multiyear rental agreements related to the $125 million of Commission approved multiyear contract authority. On December 19, 2022 the Commission approved SPC's request for $80 million of multiyear contract value authority for FY 2024.
Leases
The State routinely acquires use of real property and equipment through leases (including the multiyear contracts for energy projects and real property leases as described above). Many of these agreements contain fiscal funding clauses in accordance with O.C.G.A. 50-5-64 which prohibits the creation of a debt to the State for the payment of any sums under such agreements beyond the fiscal year of execution, or on a current year basis in the years subsequent to the initial fiscal year of execution, if appropriated funds are not available. Although these leases do not directly impact the calculation of the debt service ratio as defined by the State Constitution, they are considered by the rating agencies as tax-supported debt and are included in the rating agency's calculations. For additional information regarding leases, see the State's audited Annual Comprehensive Financial Report, available on the State Accounting Office's website at www.sao.georgia.gov.
In some instances, the lessor obtained acquisition and/or renovation financing for the property being leased by the State via a funding process which involved the issuance of revenue bonds by a local city or county government or local development authority (the proceeds then are loaned to the lessor for the acquisition and/or renovations and the state agency leases the property on an
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annually renewable basis). When this is the case (for example, the highly specialized archives storage facility originally developed for the Secretary of State which since has been transferred to the BOR), the rating agencies have indicated that despite the legal ability of the State to not renew a lease in a subsequent fiscal year, a non-appropriation of the lease payment in any year during the term of the bond issue would be viewed as an adverse credit event for the State. Numerous and consistent communications from the rating agencies have affirmed that such an event of nonappropriation likely would jeopardize the State's triple-A credit ratings as being indicative of either an unwillingness, or inability, of the State to continue the lease and thus fulfill its credit obligations. While these obligations are not legally equivalent to the debt service payment obligations for general obligation debt or guaranteed revenue debt, the annual payments essentially become a de facto fixed payment obligation which has the practical effect of binding the State to make these lease payments for the entire term of the lease, thus slightly reducing the future financial flexibility of the State.
Public University Foundation Debt
According to the BOR's Finance Office, as of June 30, 2022 the total outstanding principal amount of bonds and leases which financed USG facilities through the system's Public Private Ventures Program totaled approximately $2.621 billion. This amount includes bonds issued by local authorities, bonds issued by GHEFA (as previously discussed herein), loans from the United States Department of Agriculture, and multiyear contracts for real property leases. Proceeds of these transactions have been used to construct, renovate and/or rehabilitate, or acquire various types of projects at the colleges and universities, such as student housing, dining, research facilities, faculty and administrative office buildings, parking, and student activity facilities, which then are leased by the foundation or cooperative organization to the BOR on an annually renewable basis. Most of the projects generate revenues (such as housing fees), or the BOR has instituted dedicated student fees (such as student activity or parking fees), which provide revenues to support the annual lease payment; upon renewal of the lease each fiscal year, the lease payment obligation becomes a legal and binding obligation of the BOR for that fiscal year and thus is secured by the entirety of the legally available financial resources of the BOR. These obligations are included on the financial statements of the various USG institutions, the USG, and the State; additional information may be obtained from those documents.
Retirement Systems and Other Post-Employment Benefits (OPEB)
These liabilities do not directly impact the calculation of the State's debt service ratio as defined by the Constitution, but they do represent significant ongoing financial commitments which could affect both the current and future financial flexibility of the State. Also, the rating agencies view these liabilities as long-term tax-supported debt and include their own adjusted calculations in various calculations of tax-supported debt as an indicator of financial flexibility of the State and as comparative metrics among the states. The State has two primary pension systems (Employees' Retirement System and Teachers Retirement System); as part of its conservative debt management policies, the State fully funds the actuarially determined contributions. For a more complete description and discussion of these liabilities, which involve extremely complex actuarial calculations unique to each pension/OPEB plan and assumptions regarding investment returns of the various pension and OPEB funds, see notes 15, 16, and 17 of the State's Annual Comprehensive Financial Report which is available via the State Accounting Office's website at www.sao.georgia.gov. The calculations shown in the latter sections of the Plan currently do not include the pension or OPEB liabilities for the State or the comparison states.
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DEBT STRUCTURE
State debt may be issued with fixed interest rates or with a rate structure which can vary according to a prescribed methodology, generally known as variable rate debt. The use of variable rate debt introduces an element of interest rate risk and the potential of increased debt service payments during the period of time the variable rate debt is outstanding. During FY 2017 the State refunded all of its outstanding variable rate general obligation debt with fixed interest rate debt and no other variable rate debt has been issued since that time. There currently are no plans for considering the use of new variable rate debt during the period covered by the Plan.
Generally, the State's objective for each new GO and GR bond issue is to structure the issue with approximately level annual debt service payments corresponding with the term of, and debt service appropriation for, the authorized debt being funded by that issue. Should any variable rate debt be considered in the future, the maximum allowed interest rate would be utilized to develop a level annual debt service schedule incorporating serialized annual principal maturities and/or term bonds structured with annual mandatory redemptions for that debt.
DEBT AFFORDABILITY
The Plan is intended to ensure an acceptable balance is maintained between the provision of capital projects required to meet the State's future needs and the State's ability and willingness to repay the debt incurred to finance these projects. Through the establishment of reasonable target levels based on the State's expected population growth and per capita income projections balanced with the financial resources available to meet its debt obligations, the Plan provides assurance the authorization of additional debt by the General Assembly is at prudent levels which would not be expected to jeopardize the State's triple-A bond ratings.
There is no specific formula, however, for determining the maximum amount of debt which can be issued by the State in any particular year to accomplish these objectives. Many factors must be considered including: balancing the State's current and projected operating budget for funding both ongoing and new program requirements, current year and subsequent year projected revenues, available fund balances, and an overall plan for managing the operating budget in balance with the need for new or renovation capital projects. The Plan incorporates the concept of debt affordability in determining an acceptable amount of tax-supported debt the State can issue. Also, any model for determining debt affordability is dependent upon the reasonableness and ultimately the degree of accuracy of economic forecasts and the projected impact on the State's total financial resources. Since FY 2006, the Commission's debt management plan has utilized a more conservative 7% cap (8% including GARVEE debt) for the debt service ratio, rather than the 10% maximum as specified by the Constitution; the 7% cap is in line with the State's peer group of states rated triple-A by all three of the major credit rating agencies.
Rating Agency Considerations
Due to the economic and financial diversity among the 50 states, many purchasers of governmental bonds historically have relied heavily on the major rating agencies' analysis of the factors affecting each borrower's ability to meet its debt obligations as reflected by the ratings and outlooks on those obligations. Each issuer's rating and outlook has a significant effect on the
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marketability of its bonds and the interest rates necessary to generate investor demand for the issuer's debt obligations. The states whose GO bonds are rated triple-A generally can sell those bonds at the lowest possible interest rates at any given point in time.
Another benefit of triple-A ratings was demonstrated during the credit market disruptions of late 2008 and early 2009 when higher rated issuers were able to access the credit market sooner and in larger amounts than was the case for lower rated issuers. (For some of the referenced time period, credit market access was severely curtailed to almost nonexistent and a functional credit market was restored only in a gradual manner over several months.) A somewhat similar situation, although not for as long or as severe as in 2008-2009, occurred in the late first quarter and second quarter of calendar year 2021 due to the unsettled market conditions resulting from the impact of COVID-19 upon economic activity in the State of Georgia, the U.S., and internationally. The highest rated issuers, including the State of Georgia, were among the earliest issuers to regain access to the market, particularly with respect to larger issue sizes such as the State typically brings to market.
Rating agencies consider and incorporate trends relating to an issuer's overall debt and liability burden, revenue base, fund balances, and general economic base into their rating decisions, as well as a comparison of actual fiscal experience versus budget projections over a three- to five-year period. While specific rating criteria and weightings do vary slightly between the three rating agencies, the rating analysis generally incorporates four primary fiscal factors:
debt burden as measured by ratios, quality and strength of the state's economic base, fiscal management, and actual financial performance versus projections.
The amount of an issuer's tax supported debt is a very important factor in the determination of its credit rating. Credit analysts usually calculate several ratios, including those which are discussed in greater detail in a later section of the Plan, to measure the issuer's debt burden. Credit analysts also look for balance, diversity, and growth potential of the economic base, as well as the primary sources of revenue to generate sufficient revenues to consistently meet operating program needs as well as repay all debt obligations this is what the rating agencies generally refer to as "structural balance". Those issuers which demonstrate structural balance over both good times and bad times generally receive higher ratings than issuers which do not maintain structural balance during the bad times, or issuers which fail to regain structural balance within a reasonable period of time after major adverse events such as economic recessions or disasters such as hurricanes, tornados, significant wildfires, floods, or extreme blizzards.
When analyzing an issuer's fiscal management practices, credit analysts also compare fiscal results with budgets and plans. Over time, such comparisons tend to serve as a good indicator of the effectiveness and quality of fiscal management by the issuer. Another criterion of sound fiscal management is the existence of laws, policies, and procedures which allow an issuer to exercise strong, but reasonable and flexible, control over its sources and timing of revenues, expenditures, and debt issuance. Issuers which do not have such control, or which frequently must use one-time measures to maintain budgetary balance, are not considered to be well-managed fiscally.
Actual financial performance is a result of both the quality of a state's fiscal management and general economic performance of the local economy. One indicator of financial performance is an
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issuer's ability to adjust to revenue shortfalls due to unexpected economic downturns, or downturns that are much more severe or longer than initial expectations, such as occurred during the 2007-2009 recession and the very slow, long, and shallow recovery which followed.
Another gauge of an issuer's fiscal management and financial performance is its ability to establish and maintain reasonable levels of reserves for cushioning the effects of unexpected adverse economic events, and then its ability to rebuild those reserves in a timely manner subsequent to their use in preparation for future downturns in the economy. The State often is cited by the rating agencies as using its Revenue Shortfall Reserve appropriately building it up during periods of robust economic activity and then judiciously using it during recessions to mitigate even more significant cutbacks in service levels that likely would have been necessary without those reserve resources.
Illustrative of how these various concepts affect the State's general obligation bond rating, the rating agency credit reports with respect to the State's June 2022 sale of 2022A, 2022B, and 2022C GO Bonds highlighted the following strengths:
Moody's Investors Service (June 2, 2022): o Georgia's very strong credit quality derives from its low leverage, strong fiscal governance, solid reserves, and diverse and growth economy. o Above average population and employment growth continue to propel Georgia's economy with stronger GDP and employment growth and lower unemployment rates than the nation. o Longer term, the state's population and employment growth, especially among younger workers, and its diverse industrial mix will spur steady economic expansion. o Georgia's conservative fiscal 2022 and fiscal 2023 budgets along with strong revenue growth will continue to support its hearty reserves. o Available fund balance and unrestricted cash across governmental funds will remain strong given a likely revenue surplus in fiscal 2022 [since realized], providing ample buffer in case of an economic shock. o Georgia's total leverage from debt, pension, OPEB and other long-term liabilities are low at just 94% of governmental revenue compared with the median for all states of 148% of revenue. o The state's direct debt burden is slightly above average for the sector. However, unlike many other states, the majority of Georgia's general obligation borrowings are on behalf of public school districts and higher education projects, which somewhat inflate the debt figure. o Fixed costs are modest at about 4% of governmental revenue, providing the state financial flexibility and ample capacity to pay its annual obligations. o The state's debt policy is conservative limiting debt service to 7% of the prior year's revenue (8% include GARVEEs), a more restrictive policy than the 10% limit imposed by the state constitution. o Georgia's direct pension and OPEB burdens are among the lowest for US states and territories. o The Moody's adjusted net pension liability (ANPL) for the state is equal to a low 47% of revenue while the adjusted net OPEB liability is also small at 8% of revenue in fiscal 2021. o Georgia's fiscal governance framework and financial management practices are stronger than most states.
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o A history of prompt spending cuts in response to revenue shortfalls has been an important aspect of the state's credit profile. ... The state's annual financial statements and budgets are published in a timely fashion along with monthly revenue updates. Conservative debt management policies have also helped sustain low leverage levels.
S&P Global Ratings (June 8, 2022): o Georgia's `AAA' long-term rating is supported by our view of the state's overall strong credit fundamentals, including its large and diverse economic base that has benefited from sustained population growth and ongoing economic development efforts that have attracted considerable investment. State employment has exceeded its pre-pandemic levels at 4.8 million and its unemployment rate was well below the U.S. average at 3.1% in April. Georgia's rating is also supported by our view of a strong governmental framework that supports its ability [to] control its expenditures and manage its liquidity. o ...Georgia has demonstrated responsive financial management that has enabled timely adjustments to general fund appropriations, and has yielded resilient budgetary performance and quick rebuilding of reserve balances in its revenue shortfall reserve. o The `AAA' GO rating reflects our view of Georgia's: Very strong governmental framework, with the authority and a demonstrated willingness to make politically difficult decisions to align expenditures with revenue projections. Very strong financial and budgetary management, with well embedded, and likely sustainable processes for monitoring performance and planning for future needs. Diverse economy, with ongoing economic development projects that we believe will help sustain future growth. Generally strong budgetary performance, with a commitment to increasing and maintaining reserves during economic growth and a commitment to restoring reserves if necessary to manage revenue shortfalls. Adequate pension funding discipline, coupled with a moderate-to-low debt burden and modest upcoming debt plans that are unlikely to change our view of the state's debt profile. o Georgia's economic strength is supported by generally strong development and a diverse employment base similar to the U.S. o ...[T]he state's debt burden is low-to-moderate, and it should remain so despite future debt plans and the potential for additional borrowings over the near- to medium-term. ... Debt amortization is rapid, with 69% of GO and Guaranteed Revenue Bonds retired within 10 years and all debt within 20 years. (Note, this comment was prior to the issuance of the 2022 Guaranteed Revenue Bonds, which extend beyond 20 years.) o Georgia maintains it commitment to adequately funding its pension liabilities and in recent years the state started to prefund its other postemployment benefits (OPEB) obligations. ... Georgia has fully funded the actuarially determined contribution for each plan the past 10 years. o Georgia's GO bonds are eligible to be rated above the sovereign [U.S.] because we believe the state can maintain better credit characteristics than the U.S. in a stress scenario. ... The institutional framework in the U.S. is predictable, with significant state autonomy and flexibility demonstrated by serial bond amortization as well as independent treasury management.
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Fitch Ratings (June 10, 2022): o Georgia's `AAA' Issuer Default Rating (IDR), GO and guaranteed revenue bond ratings reflect the state's proven willingness and ability to maintain fiscal balance and a broad-based, growth oriented economy that supports solid revenue growth over time. The state's long-term liability burden is low. o Georgia's economic base is diverse and similar to that of the nation, although wealth indicators are below average. Growth in population and jobs has outpaced the nation over several decades, driving steady economic gains and providing a solid foundation for future growth. o Georgia's revenues, primarily comprising income and sales taxes, will continue to reflect the breadth of the economy and its solid long-term growth potential. o Consistent with most states, expenditure growth in Georgia is likely to marginally exceed revenue growth over time. Carrying costs for long-term liabilities are low but slightly above average for a U.S. state. Georgia retains broad expense-cutting ability. Medicaid is a key expense driver, but Fitch Ratings expects the state will continue to actively manage it to constrain expense growth. o Georgia's long-term liability debt burden is low and overall debt management is conservative. The state regularly issues bonds for capital needs and principal amortization is rapid. o The state is well-positioned to deal with economic downturns with exceptionally strong gap-closing capacity, due to its broad control over revenues and spending, coupled with its reserve-building practices. Georgia has a track record of restoring financial flexibility during economic expansions, which is important given the state's aboveaverage revenue volatility as indicated by the Fitch Analytical Stress Test (FAST) model. o Georgia's major pension systems covering both state employees [ERS] and teachers [TRS] have benefitted from consistent full actuarial contributions.
Maintaining triple-A ratings requires continued attention to debt and liability management and strong financial condition and commitment to conservative fiscal governance. The Plan contained herein adheres to the State's ongoing overall conservative fiscal management approach in support of those highest credit ratings; however, some factors that could lead to a downgrade as cited in the June 2022 reports include:
Moody's Investors Service: o A materially diminished financial position. o Growth in long-term liabilities and fixed costs that outpace expansion of the state's economy and revenue base. o A departure from strong fiscal management and governance practices.
S&P Global Ratings: o While we believe Georgia's demonstrated history of making mid-year budget adjustments to align expenditures with projected revenue will continue, should the state exhibit a significant reliance on reserves to close budget gaps without a plan to restore structural balance and replenish reserve levels could result in a lower rating.
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Fitch Ratings: o Sustained and unanticipated growth in carrying costs for debt and retirement liabilities toward or above 10% of total spending, signaling more restricted expenditure flexibility. o Failure to quickly adjust to changing fiscal and economic circumstances and address budgetary challenges, including those resulting from tax policy changes.

Measuring the Debt Burden

When calculating indebtedness, credit analysts use measures which take into account all debt supported, or serviced, by the issuer's sources of revenues, and particularly taxes such as income taxes and sales and use taxes; in most cases the debt being supported or serviced will include not only GO debt, but various leases, GARVEE bonds, and other debt depending upon the legal security and source of payments for the debt service. Such debt is classified as net tax-supported debt. For the State, net tax-supported debt includes all GO debt and GR debt but does not include any revenue bonds not supported by the guarantee of the State. GR debt is included in the calculation of net tax-supported debt because the guarantee is related to all revenues of the State and not just project revenues. Except for the GARVEE bonds as noted above, revenue bonds issued by an instrumentality of the State which do not carry the State's explicit guarantee are not included in the rating agencies' calculation of the State's net tax-supported debt. As described earlier in the Plan, the issuance of revenue bonds by State authorities requires prior approval by the Commission; such approval is granted only after careful evaluation of the dedicated revenue stream that provides the security for these issues, as well as other pertinent factors. As Authority revenues, these revenues are not included in the State's general treasury revenues and thus can be pledged to the repayment of the debt pursuant to the enabling legislation for the Authority.

The following table summarizes the State's issued principal amounts for new projects and the outstanding principal amounts as of December 31, 2022; there also remained $357.095 million of GO debt and $199.62 million of GR debt authorized which had not been incurred, although no additional debt is expected to be incurred during the remainder of FY 2023.

General Obligation Debt Guaranteed Revenue Debt Total State Obligations

Total Principal Issued $31,847,025,000 1,220,095,000 $33,067,120,000

Outstanding Principal $9,838,855,000 386,645,000 $10,225,500,000

(The remainder of this page has been left blank intentionally.)

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Five debt ratios as shown in the following table frequently are used to measure debt burden. These debt ratios provide a means to monitor the relative debt burden level for the State over a period of years; they also provide a method of comparison of debt burdens among the various states.

Debt Ratio
Debt per Capita
Debt as Percent of Personal Income
Debt Service as Percent of State Net Revenues Debt as Percent of Full Valuation of Assessed Property Debt as Percent of State Gross Domestic Product

How Ratio is Calculated Net Tax-supported Debt / State Population Net Tax-supported Debt / Total Personal Income of the State's Population Annual Debt Service Requirement / Net Revenues of the State Net Tax-supported Debt / Full Valuation of All Taxable Property Net Tax-supported Debt / State Gross Domestic Product

Credit analysts also examine how fast the debt is being repaid by calculating how much, in percentage terms, of the issuer's total long-term debt is retired after 5 and 10 years. Analysts generally use a standard for this measure of 25 percent retired in 5 years and 50 percent retired in 10 years as being more favorable than slower debt amortizations. The rating agencies routinely comment favorably about the State's rapid rate of debt repayment.

All the ratios described above serve as important tools to track and monitor the impact of the State's debt. The Plan establishes reasonable amounts and peer-group comparable levels for three of the five debt ratios to help maintain triple-A credit ratings, as well as ensuring that the State remains below the maximum allowable debt limit as established by the Constitution.

The eighteen month long financial crisis recession which began in 2007 and ended in mid2009 was quite severe and the ensuing exceptionally slower than normal economic recovery which followed resulted in dramatically reduced state treasury receipts which were very slow to recover to previous levels; however, the debt service ratio has improved in each year since then. The COVID-19 recession of 2020, however, was much faster, deeper, and considerably shorter at only two months long with the subsequent economic recovery continuing through calendar year 2021. While the national economy did experience two consecutive quarters of negative Gross Domestic Product (GDP) results in the first half of calendar year 2022, followed by a slightly positive third quarter, and fourth quarter 2022 results not yet available, Georgia's rate of economic growth has been continuous and has exceeded the rate of the national recovery as a whole. This has resulted with the official State revenue estimates being exceeded by considerable amounts for both FY 2021 and FY 2022 and the State's debt metrics have continued to improve.

As the worldwide and national economies continue to struggle to deal with the effects of the COVID-19 pandemic, including still significant disruptions in supply lines, inflation has increased considerably and central banks around the world currently are in the process of increasing interest rates in an attempt to slow economic activity to try to bring the supply and demand of goods and services into better alignment and effect a reduction in the rate of inflation. Inflation also has been exacerbated by a deficiency of worldwide energy supplies - and resulting increases in prices - as a

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result of both domestic and international events. While Georgia's economy has grown continuously since the end of the COVID-19 recession, it is not immune to the world's and U.S.'s economic situation and the State continues to maintain its long-standing conservative fiscal policies.
The Plan indicates that setting new authorizations for GO debt at $800 million annually for FY 2024 through FY 2027, along with the recent recovery and projected growth of State treasury receipts, will result in the ratio of debt service to the prior year State revenues remaining below the planning limit for the period covered by the Plan.
The maximum debt ratio planning levels utilized in the Plan are shown in the following table.

Debt Ratio Planning Level Debt Service to Prior Year Revenues Debt to Personal Income Debt per Capita

Without GARVEEs 7.0% 3.5% $1,200

With GARVEEs 8.0% 4.0% $1,500

Trend in State Debt Ratios
The following table presents a historical comparison of the State's net GO and GR indebtedness and debt ratios.

Historical Debt Ratios for General Obligation Bonds and Guaranteed Revenue Bonds

Annual

Fiscal

Debt

Debt Debt

Year

Debt

Debt to Debt

Debt to Service to Retired Retired

Ended Outstanding Personal per Estimated Prior Year in

in 10

June 30 ($ millions) Income Capita Full Value Receipts 5 Years Years

2018 $ 9,196.6

2.0% $874 0.9%

5.5%

42% 73%

2019 9,547.3

1.9

899 0.9

5.1

42

73

2020 9,551.6

1.7

892 0.8

4.9

42

73

2021 9,691.6

1.6

897 0.7

4.7

41

72

2022 10,203.5

1.7

934 0.7

4.1

40

69

During this period the net amount of debt outstanding increased by $1.007 billion and the "Debt as % of Personal Income" ratio decreased to 1.7% from 2.0%. Although the ratio "Annual Debt Service as % of Prior Year Receipts" for FY 2018 was only 5.5%, that still was somewhat elevated primarily due to the significant decline in State revenues followed by a slow recovery resulting from the severe impact of the 2007-2009 recession on Georgia's economy. As a result of the continued improvement in the State's economy during the last several years, generally lower interest rates on new debt issued, the effects of refunding debt to lower debt service payments, and despite the effects of the COVID-19 recession, this ratio improved to 4.1% for FY 2022. The percent of debt to be retired in 5 years and in 10 years has remained at levels generally viewed as favorable by the rating agencies.

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Comparison of Debt Burden to Other Triple-A States
With the recent addition of Minnesota during 2022, Georgia is one of fourteen states currently rated triple-A by all three of the three major rating agencies; however, only the eleven states shown in the following table are active issuers of general obligation debt (the states not included in the table are Indiana, Iowa, and South Dakota). As of the date of this plan, no state which has tripletriple-A ratings currently has a negative outlook on any of its ratings. To assess the reasonableness of its target debt ratios for the Plan, Georgia compares its ratios to those of this peer group.
For purposes of the Plan, in prior years Georgia made these comparisons based on the Moody's State Debt Medians report; however, Moody's has combined that report and two other reports into the "Moody's Sector Profile, States US Debt" report for FY 2021. Moody's net taxsupported debt (NTSD), as described in the report (dated Sept. 7, 2022), is characterized as debt secured by statewide taxes and other governmental revenue, net of obligations that are paid with revenue other than taxes and other governmental revenue, and that is accounted for in nongovernmental activities (such as higher education funds). NTSD typically includes public-private partnership (P3) agreements that include contractual obligations of the government to make scheduled payments, and P3 debt is valued based on the higher of the liability in the government's financial statement or the size of the government's termination payment obligation. Moody's' purpose in making this change was to align the metrics with audited financial statements as well as with their updated "US States and Territories Methodology"; they believe this will provide more consistency when comparing liabilities across states. With respect to their calculation of Georgia's amount of NTSD, it results in an amount higher than the combined amount of GO and GR bonds due to the inclusion of some additional financed amounts (primarily leases).
According to the Moody's report, pension obligations remained the largest liability for most states, increasing significantly in fiscal year 2021. Total net tax-supported debt represents the second-largest liability for most states, which also rose in fiscal year 2021, but at a much slower pace. Moody's also reported that states' ability to service debt, pension, OPEB and other longterm obligations improved in fiscal year 2021 due to increased revenues.
The following table presents Moody's FY 2021 NTSD debt ratios for the triple-A rated states and the 50-state median and average.
(Table shown on following page.)
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Fiscal Year 2021 State Net-Tax Supported Debt (NTSD) Metrics

FY 2021

States with

Rank

As % of Own

As % of

Triple-Triple-A (Among all Amount

Source

Personal

Ratings

50 states) ($ Billions) Revenue Per Capita Income

Maryland

9

$17.372

56.3% $2,818

4.1%

Delaware

12

4.157

53.9

4,143

7.0

Virginia

18

15.754

42.9

1,823

2.8

Georgia

21

11.744

37.7

1,087

2.0

Florida

25

16.476

28.5

756

1.2

Minnesota

28

8.347

25.0

1,462

2.2

Utah

30

3.002

22.0

899

1.6

Texas

31

20.128

21.6

682

1.1

North Carolina

34

7.237

19.7

686

1.2

Missouri

38

2.455

15.4

398

0.7

Tennessee

45

1.991

8.2

285

0.5

Triple-A Average (1)

--

9.878

25.0

899

1.6

Triple-A Median (1)

--

8.347

30.1

1,367

2.2

50-State Average

--

12.406

36.2

1,179

2.8

50-State Median

--

4.954

28.4

1,772

2.1

Compiled from Moody's September 7, 2022 State Sector Debt Report (1) Calculated by GSFIC staff.

As % of state GDP
4.0% 5.1 2.7 1.7 1.3 2.0 1.4 1.0 1.1 0.7 0.5 1.4 2.0 2.6 2.1

In its September 2022 report Moody's provides "implied debt service" information which is comparable to the "Debt Service to Revenues" metric presented in its prior state debt reports. Moody's considers Georgia's debt service burden to be in the low to moderate range and a credit strength for the State. At 2.5%, Georgia's implied debt service as a percentage of own source revenues is considered moderate (compared to the 50-state average of 2.5% and the 50-state median of 2.1%) This likely is the case in large part because unlike most other states, Georgia devotes a substantial portion of its debt capacity each year to providing significant levels of State bond-funded capital outlay grant funds to K-12 public school systems throughout the State. Furthermore, even for those states which have a similar public educational facilities funding program, most are not as comprehensive in scope as Georgia's program. (As previously shown within the Plan, in recent years, 26% of net authorizations has been for K-12 educational facilities.) Another likely factor is that as Georgia has been one the fastest growing states for the last several decades it has devoted substantial State bond-funded capital outlay funding to various infrastructure projects in order to meet the increasing needs resulting from the population growth and also to remain economically competitive with other states.

Standard & Poor's and Fitch also publish annual state debt metrics ranking reports. Fitch's "2022 U.S. State Medians" report dated July 21, 2022 noted that states rated `AAA' have the highest credit quality, able to withstand normal, and even abnormal, economic volatility without material impingement on financial resilience, and reflect Fitch's view that states will continue to act prudently in managing current budget surpluses to prepare for the next downturn. Standard & Poor's report dated July 6, 2022 noted that U.S. state tax-supported debt increased about 4% in the aggregate in fiscal year 2021, attributing the growth in debt levels across states to an environment of historically low interest rates which has made the cost of borrowing more favorable.

-25-

Debt Issuance Projections

For FY 2023, approved new GO debt authorizations totaled $938.935 million; when added to the $171.910 million unissued prior years' debt authorizations carried over into FY 2023, there was a total of approximately $1.111 billion GO debt authorizations available at the beginning of FY 2023. In July 2022, the State utilized $753.750 million of GO debt authorizations for the issuance of the 2022A and 2022B bonds, leaving $357.095 million of debt authorizations to be carried forward into FY 2024 (provided no additional debt is incurred during the remainder of FY 2023 and/or none is deauthorized by the General Assembly prior to being incurred).

New GO debt authorizations for FY 2024 through FY 2027 are projected at $800 million annually, as shown in the following table. The Plan also projects that all currently authorized but unissued GO debt will be issued in FY 2024 and that all new authorizations will be issued during the fiscal year authorized. Future debt is expected to be structured to achieve approximately level debt service each fiscal year for the term authorized and to be within the debt service appropriations.

Projected General Obligation Bond Authorizations Utilized ($ - Thousands)

FY 2023 FY 2024 FY 2025 FY 2026

Prior Year Authorizations Carry Over

$ 37,315 $ 357,095 $

- $

-

New 5 Year Bond Authorizations

17,770 100,000 100,000 100,000

New 10 Year Bond Authorizations

-

New 20 Year Bond Authorizations

698,935 700,000 700,000 700,000

Total GO Bond Authorizations Utilized $753,750 $1,157,095 $800,000 $800,000

FY 2027

$

-

100,000

700,000 $800,000

Based on the currently outstanding debt, new debt incurred, scheduled debt retirements, and projected debt issuance, the following table summarizes the projected combined GO and GR debt outstanding at the end of the fiscal year for each year through FY 2027 and the projected annual debt service on that debt in each year.

Combined General Obligation and Guaranteed Revenue Debt

$ - Thousands

FY 2023

FY 2024

FY 2025

FY 2026

Outstanding at Beginning of Fiscal Year

$10,203,460

$9,984,530

$10,250,755 $10,171,855

Plus GO Bonds Issued

1,191,660 1,157,095

800,000

800,000

Plus GR Bonds Issued

199,620

Less Total Principal Payments, Bonds Refunded, and Early Retirements Debt Outstanding at End of Fiscal Year HADS (For all outstanding debt plus the authorized but unissued debt)

(1,410,590) 9,984,530 1,339,705

(890,870) 10,250,755 1,398,007

(878,900) 10,171,855 1,390,478

(863,715) 10,307,760 1,389,112

FY 2027 $10,307,760
800,000
(869,130) 10,238,630 1,408,907

-26-

The following chart shows historical HADS for FY 2011 through FY 2022 and projected HADS for FY 2023 through FY 2027; it also shows both the 10% constitutional debt limit and the 7% planning limit. As previously mentioned, as part of the active and responsive financial management of the State's finances to address the decline in State revenues during and after the end of the 2007-2009 recession and the subsequent slow recovery of State revenues, the HADS ratio exceeded the 7% planning limit for several years. In response to the situation, the State reduced new debt authorizations for several years and authorized only the most critical infrastructure projects. As State revenues recovered, the HADS ratio improved to where it was possible to increase new authorizations for debt incrementally to levels more reflective of the need to fund new projects in response to the challenges created by population and economic growth throughout the State. Following the slight dip in State Treasury Receipts in FY 2020 from FY 2019 (approximately -0.3%) primarily due to the impact of the COVID-19 Recession, receipts recovered in FY 2021 to a total amount of over $30.3 billion, which was an increase of over 12.6% from FY 2020 and an increase of over 12.3% from FY 2019. Another significant increase in State Treasury Receipts occurred in FY 2022 with a total of almost $36.6 billion. In response to increased revenues, the FY 2022 amended appropriations bill provided funding with cash proceeds of over $1 billion for capital project needs. The FY 2023 budget then provided an additional $138 million in cash for ongoing capital maintenance needs for state agencies to reduce annual bond authorization needs for those activities.
As reflected on the following page, revenues are projected to decrease by 12% during FY 2023, resulting in a higher HADS ratio in FY 2024 compared to FY 2023. With a reduction in authorizations for FY 2024 through FY 2027 the HADS ratio is projected to fall back to 4.1% in FY 2027.

Millions $4,000

Highest Annual Debt Service as a Percentage of Prior Year State Treasury Receipts

$3,500

$3,000

$2,500

$2,000

$1,500 $1,000
$500

8.1% 7.0% 6.7% 6.3% 6.3% 6.0% 5.5% 5.5% 5.1% 4.9% 4.7% 4.1% 3.7% 4.3%

4.3% 4.2% 4.1% Projected

$0

Annual Debt Service

10% Constitutional Limit

7% Planning Limit

-27-

Economic and Demographic Projections

The State economist provides projections of Treasury Receipts, personal income, and assessed and actual valuation of taxable property; the Governor's Office of Planning and Budget provides estimates of the future population of the State. These projections are summarized in the following table.

Fiscal Year 2023 2024 2025 2026 2027

Treasury Receipts (billions) $32.215
32.450 33.318 34.448 35.709

Economic and Demographic Projections

Year over Year Growth

Personal Income (billions)

Year over Year Growth

Population (millions)

Year over Year Growth

-12.0% $647

5.5%

11.029 1.0%

0.7

676

4.5

11.136 1.0

2.7

706

4.5

11.242 1.0

3.4

738

4.5

11.342 0.9

3.7

771

4.5

11.442 0.9

Estimated Full Value (billions)
$1,442 1,471 1,545 1,621 1,703

Year over Year Growth 0.5% 2.0 5.0 5.0 5.0

Projected Interest Rates Assumption

In analyzing debt issuance levels for the Plan, the rise in interest rates of between 250 and 300 basis points (e.g., 2.50 % to 3.00%) over the course of calendar year 2022, with the likelihood of additional increases while the Federal Reserve continues to increase its Fed Funds interest rate in conjunction with its effort to return inflation to its target rate of approximately 2%, will have an impact in terms of higher annual debt service requirements on future issuances of State GO and GR bonds as compared to the last several years. To ensure the Plan provides sufficient debt service for future new issues of GO and GR bonds, the maximum interest rates have been adjusted to 6.25% for 5-year tax-exempt debt, 7.00% for 5-year taxable debt, 6.5% for 20-year tax-exempt debt, and 7.5% for 20-year taxable debt. Also, it has been assumed the bonds will be issued near or at par rather than including significant original issue premium as has been the case for the last several years.

Impact of Debt Issuance Projections on State Debt Ratios

As can be seen in the following table, based on the assumptions utilized in the Plan, the authorization of approximately $938.935 million of new GO debt in FY 2023 and the projected new GO debt authorizations of $800 million for FY 2024 and thereafter, will result in projected ratios that are within the Commission's planning levels. As previously discussed, the rating agencies view the percent of debt retired ratios as rapid and favorable. Furthermore, the projected ratios indicate that there still is some available margin should any of the growth rate assumptions, or projections regarding the interest rate environment, prove to be too optimistic.

(Table shown on following page.)

-28-

Projected Debt Ratios (Combined General Obligation and Guaranteed Revenue Debt)

Fiscal Year Ended June 30

Debt Outstanding
(billions)

Debt to Personal Income

Debt per Capita

Debt to Estimated Full Value

HADS to Prior Year Receipts

Debt Retired
in 5 Years

Debt Retired in 10 Years

2023 $ 9,985

1.5%

$905

0.7%

3.7%

39% 69%

2024

10,251

1.5

921

0.7

4.3

39

68

2025

10,172

1.4

905

0.7

4.3

39

68

2026

10,308

1.4

909

0.6

4.2

39

68

2027

10,239

1.3

895

0.6

4.1

38

67

CONCLUSION
The Plan serves as a guide to the State in ensuring the availability of funding for necessary capital projects required to meet the State's future needs while maintaining the balance between the State's need for capital and the ability and willingness of the State to repay additional debt. In addition, the Plan assists the State in its efforts to preserve triple-A bond ratings from all three rating agencies by assuring the rating agencies that the State can fund the capital projects necessary to sustain its economic growth while still continuing to meet citizen demand for State provided services and facilities in an affordable manner. The State has established maximum limits for the debt ratios and will continue to monitor debt levels and ratios and adjust debt issuances if the ratios consistently exceed the target levels. The Plan will be updated each subsequent year and all assumptions will be revisited and reaffirmed or revised as needed to project the State's debt capacity accurately and conservatively. The Plan indicates that the projected new bond authorization amounts will not cause the State to equal or exceed any of its planning levels for the various ratios measured by the Plan during the period covered by the Plan, even though debt outstanding at the end of each fiscal year covered by the Plan will increase slightly as a result of additional annual authorizations.
Following are tables which summarize the assumptions and resulting debt ratios, both with and without inclusion of the GARVEE bonds, based on the currently projected debt issuance schedule. The annual debt service amounts reflect actual debt service for existing debt issued as of calendar year end 2022 plus the HADS for the current authorized but unissued amounts and projected new authorizations. Additional tables present the outstanding GO bonds debt service, outstanding GR bonds debt service, and outstanding revenue bonds debt service of State authorities.

-29-

Summary of Projected Debt Ratios General Obligation and Guaranteed Revenue Debt

Principal Outstanding at Beginning of Fiscal Year ($ thousands) Issuances of New GO Bond Authorizations Issuances of Prior Year GO Bond Authorizations Issuance of GR Bonds Principal Payments for both GO Bonds and GR Bonds Premium Proceeds from GO Bond Issuances Net Effect of GO Refunding Bonds and Early Redemptions Principal Outstanding at End of Fiscal Year ($ thousands)

FY 2023 $ 651,855
716,435 37,315

FY 2024 $ 432,925
800,000 357,095

(886,290) (49,675) (36,715)

(890,870)

$ 432,925 $ 699,150

FY 2025 $ 699,150
800,000
(878,900)
$ 620,250

FY 2026 $ 620,250
800,000
199,620 (863,715)
$ 756,155

FY 2027 $ 756,155
800,000
(869,130)
$ 687,025

State Treasury Receipts ($ millions) Population (millions) Personal Income ($ billions) Property Valuation ($ billions)

32,215 11.029
647 1,442

32,450 11.136
676 1,471

33,318 11.242
706 1,545

34,448 11.342
738 1,622

35,709 11.442
771 1,703

Ratios for Outstanding Principal at the End of the Fiscal Year Debt to Personal Income Debt per Capita Debt to Estimated Actual Property Value

0.1% $39 0.0%

0.1% $63 0.0%

0.1% $55 0.0%

0.1% $67 0.0%

0.1% $60 0.0%

Annual Debt Service Ratios* Actual Annual Debt Service - Issued (through 12/31/2022) Guaranteed Revenue Bonds - HADS (Unissued) General Obligation Bonds - HADS (Unissued) Total Highest Annual Debt Service Calculation

$ 1,291,977 $ 1,279,484 $ 1,184,475 $ 1,095,629 $

13,465

13,465

13,465

13,465

34,264

105,058

192,538

280,018

$ 1,339,705 $ 1,398,007 $ 1,390,478 $ 1,389,112 $

Debt Service to Prior Year Receipts

3.7%

4.3%

4.3%

4.2%

*Highest annual debt service is based on (1) actual debt service for debt that has been issued as of 12/31/2022 and (2) highest annual authorized debt service (HADS) for unissued authorizations. No additional debt is expected to be incurred prior to the end of FY 2023.

1,027,944 13,465
367,498 1,408,907
4.1%

-30-

Summary of Projected Debt Ratios General Obligation, Guaranteed Revenue, and GARVEE Debt

Principal Outstanding at Beginning of Fiscal Year ($ thousands) Issuances of New and Prior Year GO Bond Authorizations Issuance of GR Bonds Principal Payments: GO, GR, and GARVEE Bonds Premium Proceeds from GO Bond Issuances Net Effect of GO Refunding Bonds and Early Redemptions Principal Outstanding at End of Fiscal Year ($ thousands)

FY 2023 $ 10,661,465
753,750
(924,100)

FY 2024 $ 10,491,115
1,157,095
(930,585)

FY 2025 $ 10,717,625
800,000
(920,585)

FY 2026 $ 10,597,040
800,000 199,620 (907,485)

FY 2027 $ 10,689,175
800,000
(915,085)

$ 10,491,115 $ 10,717,625 $ 10,597,040 $ 10,689,175 $ 10,574,090

State Treasury Receipts ($ millions) Estimated Federal Reimbursements ($ millions) Total Revenues ($ millions)

32,215 1,479
33,693

32,450 1,508
33,958

33,318 1,538
34,856

34,448 1,569
36,017

35,709 1,601
37,310

Population (millions) Personal Income ($ billions) Property Valuation ($ billions)

11.029 647
1,442

11.136 676
1,471

11.242 706
1,545

11.342 738
1,622

11.442 771
1,703

Ratios for Outstanding Principal at the End of the Fiscal Year Debt to Personal Income Debt per Capita Debt to Estimated Actual Property Value

1.6% $951 0.7%

1.6% $962 0.7%

1.5% $943 0.7%

1.4% $942 0.7%

1.4% $924 0.6%

Highest Annual Debt Service Ratios* Highest Annual Debt Service (GO Bonds and GR Bonds) GARVEE Debt Service - Issuances as of 12/31/2022 Debt Service to Prior Year Total Revenues Debt Service to Current Year Total Revenues

1,339,705 60,432 3.7% 4.2%

1,398,007 60,446 4.3% 4.3%

1,390,478 60,442 4.3% 4.2%

1,389,112 60,442 4.2% 4.0%

1,408,907 60,439 4.1% 3.9%

* Projected annual debt service is based on (1) actual debt service for debt that has been issued as of 12/31/2022 and (2) highest annual debt service (HADS) for unissued authorizations. No additional debt is expected to be incurred prior to the end of FY 2023.

-31-

APPENDIX A
STATE OF GEORGIA GENERAL OBLIGATION BONDS
AND GUARANTEED REVENUE BONDS DEBT SERVICE SCHEDULES AS OF JUNE 30, 2022
and AS OF DECEMBER 31, 2022

State of Georgia

General Obligation Bonds Debt Service Schedule As of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 Total

Principal $ 863,640,000
850,545,000 809,940,000 754,560,000 717,920,000 660,335,000 661,755,000 585,555,000 554,105,000 508,435,000 511,650,000 431,185,000 384,135,000 339,240,000 297,075,000 238,535,000 246,410,000 180,220,000 131,090,000 67,835,000 $ 9,794,165,000

Interest $ 382,314,281
345,740,362 310,850,305 276,677,357 245,633,573 215,215,032 186,178,578 158,979,582 135,145,458 113,198,826 92,409,082 73,085,079 57,956,780 44,384,967 32,662,598 22,994,173 15,177,464
8,364,241 3,745,835
963,526 $ 2,721,677,098

Total Debt Service $ 1,245,954,281
1,196,285,362 1,120,790,305 1,031,237,357
963,553,573 875,550,032 847,933,578 744,534,582 689,250,458 621,633,826 604,059,082 504,270,079 442,091,780 383,624,967 329,737,598 261,529,173 261,587,464 188,584,241 134,835,835 68,798,526 $ 12,515,842,098

Note: amounts as shown above may not add precisely due to rounding.

A-1

State of Georgia

Guaranteed Revenue Bonds Debt Service Schedule As of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 Total

Principal $ 22,650,000
19,265,000 -
4,440,000 6,320,000 8,725,000 10,940,000 13,365,000 13,755,000 14,305,000 14,875,000 15,470,000 16,095,000 16,740,000 17,400,000 18,100,000 18,825,000 19,575,000 20,365,000 21,170,000 22,025,000 22,680,000 23,360,000 24,065,000 24,785,000 $ 409,295,000

Interest $ 5,863,820
9,650,265 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 12,663,100 12,568,480 12,437,438 12,264,815 11,970,403 11,499,350 10,938,150 10,354,550 9,747,650 9,116,350 8,459,650 7,776,850 7,066,850 6,328,350 5,560,350 4,761,550 3,930,850 3,177,075 2,506,500 1,815,900 1,104,525
371,775 $ 258,139,635

Total Debt Service $ 28,513,820
28,915,265 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 17,103,100 18,888,480 21,162,438 23,204,815 25,335,403 25,254,350 25,243,150 25,229,550 25,217,650 25,211,350 25,199,650 25,176,850 25,166,850 25,153,350 25,135,350 25,126,550 25,100,850 25,202,075 25,186,500 25,175,900 25,169,525 25,156,775 $ 667,434,635

Note: all outstanding GR bonds were issued by SRTA.

A-2

State of Georgia

General Obligation and Guaranteed Revenue Bonds Combined Debt Service Schedule As of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 Total

Principal $ 886,290,000
869,810,000 809,940,000 754,560,000 717,920,000 660,335,000 661,755,000 585,555,000 558,545,000 514,755,000 520,375,000 442,125,000 397,500,000 352,995,000 311,380,000 253,410,000 261,880,000 196,315,000 147,830,000 85,235,000 18,100,000 18,825,000 19,575,000 20,365,000 21,170,000 22,025,000 22,680,000 23,360,000 24,065,000 24,785,000 $ 10,203,460,000

Interest $ 396,544,621
358,922,827 323,551,145 289,378,197 258,334,413 227,915,872 198,879,418 171,680,422 147,808,558 125,767,306 104,846,520 85,349,894 69,927,183 55,884,317 43,600,748 33,348,723 24,925,114 17,480,591 12,205,485
8,740,376 7,066,850 6,328,350 5,560,350 4,761,550 3,930,850 3,177,075 2,506,500 1,815,900 1,104,525
371,775 $ 2,991,715,454

Total Debt Service $ 1,282,834,621
1,228,732,827 1,133,491,145 1,043,938,197
976,254,413 888,250,872 860,634,418 757,235,422 706,353,558 640,522,306 625,221,520 527,474,894 467,427,183 408,879,317 354,980,748 286,758,723 286,805,114 213,795,591 160,035,485 93,975,376 25,166,850 25,153,350 25,135,350 25,126,550 25,100,850 25,202,075 25,186,500 25,175,900 25,169,525 25,156,775 $ 13,195,175,454

Note: amounts shown above may not add precisely due to rounding.

A-3

State of Georgia
General Obligation Bonds Debt Service Schedule
As of December 31, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 Total

Principal $ 240,970,000
871,605,000 832,495,000 778,665,000 742,965,000 686,360,000 684,905,000 609,835,000 579,770,000 535,630,000 540,535,000 465,300,000 419,905,000 376,745,000 335,875,000 279,630,000 288,520,000 224,815,000 177,565,000 116,275,000
50,490,000 $ 9,838,855,000

Interest $ 198,919,627
375,431,262 339,278,892 304,263,548 272,277,758 240,880,641 210,959,530 182,632,091 157,412,249 133,933,661 111,423,816
90,462,953 73,684,400 58,376,759 44,834,168 33,411,073 23,900,014 15,305,115
8,809,728 4,064,855 1,049,070 $ 2,881,311,208

Total Debt Service $ 439,889,627
1,247,036,262 1,171,773,892 1,082,928,548 1,015,242,758
927,240,641 895,864,530 792,467,091 737,182,249 669,563,661 651,958,816 555,762,953 493,589,400 435,121,759 380,709,168 313,041,073 312,420,014 240,120,115 186,374,728 120,339,855
51,539,070 $ 12,720,166,208

Note: amounts shown above may not add precisely due to rounding.

A-4

State of Georgia

Guaranteed Revenue Bonds Debt Service Schedule
As of December 31, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 Total

Principal

$

-

19,265,000

-

-

-

-

-

-

4,440,000

6,320,000

8,725,000

10,940,000

13,365,000

13,755,000

14,305,000

14,875,000

15,470,000

16,095,000

16,740,000

17,400,000

18,100,000

18,825,000

19,575,000

20,365,000

21,170,000

22,025,000

22,680,000

23,360,000

24,065,000

24,785,000

$ 386,645,000

Interest $ 6,832,045
13,182,465 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 12,700,840 12,663,100 12,568,480 12,437,438 12,264,815 11,970,403 11,499,350 10,938,150 10,354,550 9,747,650 9,116,350 8,459,650 7,776,850 7,066,850 6,328,350 5,560,350 4,761,550 3,930,850 3,177,075 2,506,500 1,815,900 1,104,525
371,775 $ 262,640,060

Total

Debt Service

$

6,832,045

32,447,465

12,700,840

12,700,840

12,700,840

12,700,840

12,700,840

12,700,840

17,103,100

18,888,480

21,162,438

23,204,815

25,335,403

25,254,350

25,243,150

25,229,550

25,217,650

25,211,350

25,199,650

25,176,850

25,166,850

25,153,350

25,135,350

25,126,550

25,100,850

25,202,075

25,186,500

25,175,900

25,169,525

25,156,775

$ 649,285,060

Note: amounts shown above may not add precisely due to rounding.

A-4

APPENDIX B
DEBT SERVICE SCHEDULES For
STATE AUTHORITIES

Georgia Higher Education Facilities Authority
Revenue Bonds Series 2015 Refunding, Series 2019 Refunding, and Series 2020 Refunding
Debt Outstanding as of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 Total

Principal $ 6,465,000
6,785,000 7,125,000 7,480,000 7,780,000 8,115,000 8,480,000 8,910,000 9,350,000 9,755,000 10,145,000 10,610,000 11,100,000 11,575,000 12,035,000 12,530,000 13,015,000 5,890,000 3,305,000 $ 170,450,000

Interest $ 7,386,325
7,063,075 6,723,825 6,367,575 6,060,475 5,736,069 5,365,919 4,941,919 4,496,419 4,079,919 3,698,619 3,235,419 2,750,669 2,270,219 1,801,025 1,313,188
835,481 339,106 132,200 $ 74,597,446

Total Debt Service $ 13,851,325
13,848,075 13,848,825 13,847,575 13,840,475 13,851,069 13,845,919 13,851,919 13,846,419 13,834,919 13,843,619 13,845,419 13,850,669 13,845,219 13,836,025 13,843,188 13,850,481
6,229,106 3,437,200 $ 245,047,446

Note: amounts shown above may not add precisely due to rounding.

B-1

Georgia Housing and Finance Authority
Single Family Mortgage Bonds Debt Outstanding as of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 Total

Principal $ 43,480,000 $
44,410,000 47,230,000 45,565,000 42,570,000 42,085,000 45,500,000 48,640,000 48,390,000 45,375,000 47,475,000 46,805,000 48,740,000 49,360,000 54,805,000 61,595,000 62,480,000 64,345,000 68,305,000 62,810,000 59,965,000 63,650,000 44,765,000 52,850,000 59,890,000 58,195,000 48,785,000 33,430,000
4,285,000 5,470,000 $ 1,451,250,000 $

Interest 45,418,215 44,197,252 43,122,789 41,846,965 40,644,337 39,481,657 38,281,898 36,889,027 35,443,410 34,020,376 32,644,005 31,155,755 29,716,855 28,122,209 26,581,186 24,719,948 22,618,790 20,534,760 18,331,636 15,968,706 13,889,898 11,767,331 9,747,462 8,263,928 6,321,038 4,282,220 2,431,794 924,049 234,698 73,845
707,676,034

Total Debt Service $ 88,898,215
88,607,252 90,352,789 87,411,965 83,214,337 81,566,657 83,781,898 85,529,027 83,833,410 79,395,376 80,119,005 77,960,755 78,456,855 77,482,209 81,386,186 86,314,948 85,098,790 84,879,760 86,636,636 78,778,706 73,854,898 75,417,331 54,512,462 61,113,928 66,211,038 62,477,220 51,216,794 34,354,049
4,519,698 5,543,845 $ 2,158,926,034

Note: amounts shown above may not add precisely due to rounding.

B-2

Lake Lanier Islands Development Authority
2008 Revenue Bonds and GEFA Loan Debt Outstanding as of June 30, 2022

Fiscal Year 2023 2024 2025 2026 2027 2028 Total

Principal $ 1,764,077
1,815,034 1,868,038 1,923,189
951,854 787,983 $ 9,110,175

Interest $ 277,315
226,359 173,354 118,203 66,843 26,174 $ 888,248

Total Debt Service $ 2,041,392
2,041,392 2,041,392 2,041,392 1,018,696
814,157 $ 9,998,423

Note: amounts shown above may not add precisely due to rounding.

B-3

Georgia Ports Authority

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 Total

Revenue Bonds Series 2021 and Series 2022

Debt Outstanding as of December 31, 2022 (1)

Principal $ 14,320,000
10,435,000 17,150,000 21,960,000 23,055,000 24,210,000 25,420,000 26,690,000 28,030,000 29,425,000 30,900,000 32,445,000 34,070,000 35,770,000 37,560,000 39,295,000 41,115,000 43,075,000 44,800,000 46,705,000 48,870,000 51,210,000 53,365,000 55,610,000 57,955,000 60,420,000 63,030,000 65,755,000 68,600,000 46,820,000 $ 1,178,065,000

Interest 49,246,265 53,173,763 52,652,013 51,794,513 50,696,513 49,543,763 48,333,263 47,062,263 45,727,763 44,326,263 42,855,013 41,310,013 39,687,763 37,984,263 36,195,763 34,460,413 32,644,013 30,678,350 28,955,350 27,049,050 24,885,650 22,543,413 20,390,313 18,144,113 15,800,913 13,333,056 10,721,844
7,996,450 5,151,975 2,183,050 $ 985,527,140

Total Debt Service 63,566,265 63,608,763 69,802,013 73,754,513 73,751,513 73,753,763 73,753,263 73,752,263 73,757,763 73,751,263 73,755,013 73,755,013 73,757,763 73,754,263 73,755,763 73,755,413 73,759,013 73,753,350 73,755,350 73,754,050 73,755,650 73,753,413 73,755,313 73,754,113 73,755,913 73,753,056 73,751,844 73,751,450 73,751,975 49,003,050
$ 2,163,592,140

Note: amounts shown above may not add precisely due to rounding.
(1) This schedule reflects debt service outstanding as of December 31, 2022 to include the 2022 Bonds which were issued in August 2022 because of the significant increase in outstanding debt for the Authority.

B-4

State Road and Tollway Authority
GARVEE Bonds Series 2017 and Series 2020
Debt Outstanding as of June 30, 2022

Fiscal Year
2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Total

Principal
$ 37,810,000 39,715,000 41,685,000 43,770,000 45,955,000 48,250,000 50,665,000 45,935,000 48,230,000 50,640,000
$452,655,000

Interest
$ 22,621,800 20,731,300 18,756,500 16,672,250 14,483,750 12,186,000 9,773,500 7,240,250 4,943,500 2,532,000
$129,940,850

Total Debt Service
$ 60,431,800 60,446,300 60,441,500 60,442,250 60,438,750 60,436,000 60,438,500 53,175,250 53,173,500 53,172,000
$582,595,850

B-5

Georgia World Congress Center Authority
Convention Center Hotel First Tier Revenue Bonds, Series 2021A And
Convention Center Hotel Second Tier Revenue Bonds, Series 2021B

Fiscal Year 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053 2054 Total

Debt Outstanding as of June 30, 2022

Principal

$

-

-

-

-

7,240,000

7,705,000

8,200,000

8,700,000

9,225,000

9,760,000

10,460,000

11,185,000

11,705,000

12,240,000

12,795,000

13,380,000

13,990,000

14,615,000

15,280,000

15,970,000

16,685,000

17,430,000

18,205,000

19,025,000

19,865,000

20,750,000

21,660,000

22,630,000

23,615,000

24,665,000

25,745,000

26,870,000

$ 439,595,000

Interest $ 19,106,125
19,106,125 19,106,125 19,106,125 19,106,125 18,873,550 18,622,056 18,360,056 18,083,681 17,792,150 17,341,650 16,860,150 16,346,500 15,810,700 15,252,150 14,670,000 14,063,000 13,430,100 12,770,700 12,083,100 11,366,300 10,619,250
9,840,700 9,029,400 8,183,450 7,302,050 6,383,350 5,426,300 4,428,350 3,388,950 2,305,350 1,176,300 $ 415,339,919

Total Debt Service
$ 19,106,125 19,106,125 19,106,125 19,106,125 26,346,125 26,578,550 26,822,056 27,060,056 27,308,681 27,552,150 27,801,650 28,045,150 28,051,500 28,050,700 28,047,150 28,050,000 28,053,000 28,045,100 28,050,700 28,053,100 28,051,300 28,049,250 28,045,700 28,054,400 28,048,450 28,052,050 28,043,350 28,056,300 28,043,350 28,053,950 28,050,350 28,046,300
$ 854,934,919

Note: amounts shown above may not add precisely due to rounding.

B-6

STATE OF GEORGIA
Georgia State Financing and Investment Commission
270 WASHINGTON STREET S.W., SUITE 2140 | ATLANTA, GA 30334-8500 | 404.463.5600 | GSFIC.GEORGIA.GOV