In a first of its kind sale in Rhode Island, $25M of the sale of Tax Anticipation Notes last October were purchased by RI retail investors

PROVIDENCE 6/29/2009 - General Treasurer Frank Caprio announced today that the State of Rhode Island will repay on June 30, 2009 the $350M borrowed on October 27, 2008 in a ground-breaking offering of Tax Anticipation Notes (TANs).

The notes allow the State to fund projects and pay general operating expenses during the early part of the fiscal year while waiting for the actual collection of taxes in the spring. The State of Rhode Island is no stranger to TANs, issuing them regularly in recent years.

"Generally, debt obligations of this nature are expected to be paid in full within no more than one calendar year," said Treasurer Caprio.

"In Rhode Island's case, the debt will be repaid on June 30, 2009, the last day of the current fiscal year. This is in line with Rhode Island's constitutional requirement for a balanced budget," said Caprio.

In an unprecedented move last October, General Treasurer Caprio made the short-term notes available to all Rhode Islanders at several area Bank of America locations and through other registered investment advisors.

Just over $25M of the $350M TANs were sold directly to Rhode Islanders, who were given first priority to buy the bonds.

"In the past, TANs offered by the State were primarily bought by large institutions. We made the purchase of these tax-free short-term notes more accessible for Rhode Island's business community and its citizens," said Treasurer Caprio.

The $350M will be repaid from a reserve fund set up by the Office of the Rhode Island General Treasurer. The fund currently holds all recent tax collections garnered by the State. Related links

Department or agency: RI Office of the General Treasurer

Online: http://www.treasury.ri.gov/

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