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State Funding Board approves financing schedule, cancels unissued highway bonds and authorizes GO issuance
Summary
The State Funding Board approved the Tennessee Housing Development Agency's financing schedule, authorized general obligation bond issuance under the 2026 bond bill, and approved several reallocations and cancellations of bond authority including $127 million in unissued highway bonds; all measures passed by voice vote.
The State Funding Board on a routine voice vote approved a slate of financing measures, including the Tennessee Housing Development Agency's schedule of financing, cancellation of certain unissued highway bond authority and authorization to issue general obligation bonds under the 2026 bond bill.
Michelle Bosch, chief financial officer of the Tennessee Housing Development Agency, told the board the schedule outlines anticipated issuances for affordable housing mortgage funding and projected three bond sales next fiscal year. "We expect to have a bond issuance in September, another one in November, and the last one in March," Bosch said, and she added the agency's outstanding debt sits below regulatory thresholds at about $3.5 billion.
The board approved a resolution allocating $132,575.50 from the debt service fund to the capital projects fund and canceling certain authorized bonds tied to property acquisitions for the University of Memphis master plan. Kayla Carr explained those properties had been financed with commercial paper and the annual process repays and cancels the related amounts.
Carr also presented and the board certified special revenues under Tennessee Code Annotated 9-9-104B for bonds issued prior to 2013, noting a memo from the Commissioner of Finance confirming payments have been made, that the state is not in default, and that pledged fees and taxes remain sufficient for principal and interest.
Separately, the board approved a resolution that cancels approximately $127 million in unissued general obligation bonds originally authorized in 2018 for highway construction projects, a step Kayla Carr said responds to direction in the 2026 Appropriations Act and reflects the state's continued preference for pay-as-you-go road funding.
The board also approved a resolution authorizing issuance of state general obligation bonds pursuant to the 2026 bond bill (Public Acts of 2026, Chapter 989). For the TCRS standby commercial paper purchase agreement, members accepted a letter from the Tennessee Consolidated Retirement System and authorized the comptroller to notify TCRS that the State Funding Board likewise does not plan to terminate its standby purchase contract before July 1, 2027.
All of these items were moved, seconded and approved by voice vote with no opposition recorded. The board indicated most items were routine year-end and housekeeping actions tied to cash‑management and statutory requirements.
The board adjourned after acknowledging the actions; no further business was taken at the meeting.
