School District BANs (Bond Anticipation Notes) – FAQ & Reporting Guide
What are BANS?
Bonds vs. BANS – What are the Key Differences?
What Forms and Schedules are involved with BANs?
What lines are BANs reported on?
BAN Edits – Understanding What the System Checks and Why
Examples – Issuing and Paying Off BANS
Issue a BAN, No Principal Payments Made
Issue a BAN, Payments Made
Pay Off a BAN with a New BAN
Pay Off a BAN with a Bond
BAN Converted to Bond with DASNY
How are BANs connected to the Financial Statements (F/S)
What are BANs?
A Bond Anticipation Note (BAN) is a short-term debt instrument issued by a school district to provide temporary financing in anticipation of a future bond issuance.
Purpose:
- To finance projects or other large expenses before issuing permanent long-term bonds
Key Characteristics:
- Term: Typically one year; can be renewed annually for up to five years
- Repaid by:
- Issuing bonds later (conversion)
- Budget appropriations (redeemed from appropriations)
- Capital projects under construction
- Scenarios where timing or market conditions delay bond issuance
- Purchasing buses or equipment that will eventually be bond-financed
Governed By:
- NYS Local Finance Law
- Office of the State Comptroller (OSC)
- Governmental Accounting Standards Board (GASB) Standards
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Bonds vs. BANS - What are the Key Differences?
Bonds
- Term: Long-term (>1 year)
- Purpose: Permanent financing for projects and expenses
- Repayment: Scheduled over many years
BANs
- Term: Short-term (generally ≤1 year; rarely up to 2, renewable up to 5 years)
- Purpose: Temporary funding before bond issuance
- Repayment: Paid from bond proceeds or appropriations
What Forms and Schedules are Involved with BANs?
- SS-1 – Primary schedule for tracking BAN activity
- SS-2 – Reports BAN Payable if not in General or Capital Funds (2-year BANs)
- Schedule A3 – Records BAN proceeds in General Fund
- Schedule A4c – Records BAN principal and interest paid in General Fund
- Schedule F2 – Records BAN principal and interest paid in Debt Service Fund
- Schedule G2 – Records BAN proceeds and redemptions in Capital Fund
- Exhibits A & F – Records BAN Payable in General or Capital Fund
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What Lines are BANs Reported On?
General Fund
- Exhibit A – Line 45: BAN Payable
- Schedule A3 – Line 128: BAN Proceeds from Long-Term Debt
- Schedule A4c – Lines 402–406: BAN Principal Paid
- Schedule A4c – Lines 435–440: BAN Interest Paid
Debt Service Fund
- Schedule F2 – Lines 27–31: BAN Principal Paid
- Schedule F2 – Lines 60–65: BAN Interest Paid
Capital Fund
- Exhibit G – Line 20: BAN Payable
- Schedule G2 – Line 16: BAN (Proceeds of Long-Term Debt) – Only used for BANs issued for 2 years
- Schedule G2 – Line 17: BAN Redeemed from Appropriations - Totaled from each section below on Schedule G2 (e.g., lines 39, 40)
SS-1 (Schedule of Indebtedness)
- BAN Section (Lines 29–35) includes:
- Outstanding Balances
- Prior Year Adjustments
- Issued Amount
- Principal and Interest Paid
SS-2 (Statement of Non-Current Governmental Liabilities)
- Line 2 – BAN Payable (only if BAN is issued for 2 years; otherwise use Exhibit A or Exhibit G)
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What does the system check for BAN reporting (BAN Edits) and why are they important?
Edit 103 – BAN Principal Payments Must Match
- Purpose: Checks for consistency in BAN principal payment reporting
- What It Does: Compares BAN principal paid on SS-1 to Schedules A4c and F2 (General and Debt Service Funds)
- Why It Matters: Ensures BAN principal payments are fully and accurately reported
Edit 104 – BAN Outstanding Balances Check
- Purpose: Validates BAN outstanding balances across SS-1, SS-2, Exhibit A, and Exhibit G
- What It Does: Compares BAN outstanding on SS-1 vs Exhibit A, Exhibit G, and SS-2 (General and Capital Funds, and Statement of Non-Current Governmental Liabilities)
- Why It Matters: Aligns BAN balances to prevent discrepancies in liabilities
Edit 105 – BAN Interest Payments Must Match
- Purpose: Ensures accurate reporting of BAN interest expenses
- What It Does: Compares BAN interest paid on SS-1 to Schedules A4c and F2 (General and Debt Service Funds)
- Why It Matters: Confirms interest expense is consistently reported across applicable schedules
Edit 106 – BAN Interest Paid Without Principal Payment
- Purpose: Identifies potentially incomplete BAN payment activity
- What It Does: Flags if BAN interest was paid on SS-1 but no BAN principal was paid on SS-1
- Why It Matters: Highlights possible reporting errors or missing principal payments
Edit 122 – BAN Redemption vs Principal Paid Check
- Purpose: Ensures BAN redemptions from appropriations are properly recorded
- What It Does: Compares BAN redeemed from appropriations on Schedule G2 (Capital Fund) vs BAN principal paid on Schedules A4c and F2 (General and Debt Service Funds)
- Why It Matters: Confirms that redemption activity is accurately reflected across funds
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How should BAN activity be reported?
Scenario 1: District issues a BAN, but no principal payments have been made.
Step-by-Step Reporting Instructions:
Step 1: Record the new BAN(s) on SS-1
- Enter the amount issued on line 32
- If any interest payments made, enter amount on line 35
- If in General Fund → Exhibit A, line 45
- If in Capital Fund → Exhibit G, line 20
- If a 2-year BAN → SS-2, line 2
- The amount on SS-1 line 34 must equal cumulative amounts on Exhibit A, G, and SS-2 lines above.
- General Fund → Schedule A3, line 128
- Capital Fund → Schedule G2, line 16 (summation of sections on lower part of schedule)
- BAN revenue on Schedules A3/G2 should equal amount of new BAN Payable on SS-2
- General Fund → Schedule A4c, lines 435-440
- Debt Service Fund → Schedule F2, lines 60-65
- Total BAN interest on Schedules A4c/F2 should equal BAN interest paid on line 35 of SS-1
- No BAN-related edits should trigger, unless due to rounding
Back to Top Scenario 2: District issues a BAN and principal and/or interest payments have been made.
Step-by-Step Reporting Instructions:
Step 1: Record the new BAN(s) on SS-1
- Enter the amount issued on line 32
- Enter the principal paid on line 33
- Enter the interest paid on line 35
- If in General Fund → Exhibit A, line 45
- If in Capital Fund → Exhibit G, line 20
- If a 2-year BAN → SS-2, line 2
- The amount on SS-1 line 34 must equal cumulative amounts on Exhibit A, G, and SS-2 lines above.
- General Fund → Schedule A3, line 128
- Capital Fund → Schedule G2, line 16 (summation of sections on lower part of schedule)
- BAN revenue on Schedules A3/G2 should equal amount of new BAN Payable on SS-2
- General Fund → Schedule A4c, lines 402-406
- Debt Service Fund → Schedule F2, lines 27-31
- Total BAN principal on Schedules A4c/F2 should equal BAN principal paid on line 33 of SS-1
- Capital Fund → Schedule G2, line 17 (summation of sections of lower part of schedule)
- This should equal BAN principal paid above in Step 4
- General Fund → Schedule A4c, lines 435-440
- Debt Service Fund → Schedule F2, lines 60-65
- Total BAN interest on Schedules A4c/F2 should equal BAN interest paid on line 35 of SS-1
- No BAN-related edits should trigger, unless due to rounding
Back to Top Scenario 3: District pays off an old BAN using proceeds from a newly issued BAN.
Step-by-Step Reporting Instructions:
Step 1: Record the new BAN(s) on SS-1
- Enter the amount issued on line 32
- Enter the principal paid on line 33, including both old BAN payoff and any payments toward new BAN (if any).
- Enter the interest paid on line 35, including both old BAN payoff and any payments toward new BAN (if any).
- If in General Fund → Exhibit A, line 45
- If in Capital Fund → Exhibit G, line 20
- If a 2-year BAN → SS-2, line 2
- The amount on SS-1 line 34 must equal cumulative amounts on Exhibit A, G, and SS-2 lines above.
- General Fund → Schedule A3, line 128
- Capital Fund → Schedule G2, line 16 (summation of sections on lower part of schedule)
- BAN revenue on Schedules A3/G2 should equal amount of new BAN Payable on SS-2
- General Fund → Schedule A4c, lines 402-406
- Debt Service Fund → Schedule F2, lines 27-31
- Exclude new BAN proceeds used to pay off old BAN (this will NOT equal SS-1 line 33)
- Capital Fund → Schedule G2, line 17 (summation of sections of lower part of schedule)
- This should equal BAN principal paid above in Step 4
- General Fund → Schedule A4c, lines 435-440
- Debt Service Fund → Schedule F2, lines 60-65
- Total BAN interest on Schedules A4c/F2 should equal BAN interest paid on line 35 of SS-1
- No BAN-related edits should trigger, unless due to rounding
Back to Top Scenario 4: District fully pays off a BAN using bond proceeds.
Step-by-Step Reporting Instructions:
Step 1: Record the new BAN(s) on SS-1
- Enter the principal paid on line 33
- Enter the interest paid on line 35
- BAN Outstanding on line 34 should be $0
- If in General Fund → Exhibit A, line 45
- If in Capital Fund → Exhibit G, line 20
- If a 2-year BAN → SS-2, line 2
- General Fund → Schedule A4c, lines 402-406
- Debt Service Fund → Schedule F2, lines 27-31
- Exclude Bond proceeds used to pay off BAN (this will NOT equal SS-1 line 33)
- Capital Fund → Schedule G2, line 17 (summation of sections of lower part of schedule)
- This should equal BAN principal paid above in Step 3
- General Fund → Schedule A4c, lines 435-440
- Debt Service Fund → Schedule F2, lines 60-65
- Total BAN interest on Schedules A4c/F2 should equal BAN interest paid on line 35 of SS-1
- Capital Fund → Schedule G2, lines 13-15 (summation of sections of lower part of schedule)
- In most instances, this should equal or exceed the amount of BAN paid off on SS-1 line 33
- Blank section between line 50-202
- Include Issue Date, Interest Rate, Amount Issued, Principal and Interest Paid (if any)
- Record any other Bond activity during the year (if any). See Bonds FAQ for any assistance.
- Edit 103 may trigger; in most instances, the difference should be less than or equal to the Bond proceeds received on Schedule G2.
- If a premium or other funds were used, the difference may be larger but should be less than or equal to the cumulative premium + other funds + bond proceeds
- Add comment explaining BAN was paid off with Bond Proceeds, include premium/other funds used if applicable
- No other BAN-related edits should trigger, unless due to rounding
Back to Top Scenario 5: DASNY converts a BAN by issuing a bond for a group of districts.
Key Points:
- When DASNY issues a bond, they do it for a group of districts
- DASNY takes the premium on the total debt issuance and divides proportionally between the districts included in the bond issuance
- DASNY applies the premium against the planned Bond to lower the final amount issued
- DASNY used the premium to fund the lower costs
- Different from when a district issues a bond independently
- Premiums can only be used to fund a project or pay debt service on a project
In the example below, a BAN of $4,757,648 is converted into a $4,165,000 bond. The Debt Service Fund pays $152,648 toward the BAN principal and uses part of the $570,946 bond premium — $440,000 for the BAN conversion and $130,946 for closing costs. Interest on the BAN, which is paid by the Debt Service Fund, comes to $154,623.56.
Primarily, you follow the steps under “Scenario 4: District fully pays off a BAN using bond proceeds”, but with a few key differences for a DASNY conversion:
- Steps 1–2:
- Enter a Prior Year Adj Minus on Line 31 of SS-1 for the converted BAN. In the Line 31 Specify Box, make sure to note that this adjustment is due to a DASNY BAN-to-Bond Conversion.
- BAN Outstanding/Payable: If there are no other BANs, this should now be $0. If other BANs exist that were not converted or fully paid off, it will not be $0.
- Step 7: For Other Bond activity, include the Closing Costs/Fiscal Agent Fees on Line 9 of Schedule F2. Record the Premium on Obligations on Line 3 of Schedule F2 (Debt Service Fund).
- Step 8: Edit 103 likely will not trigger, since the Prior Year Adj Minus line was used
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How are BANs Reflected in the Financial Statements (F/S)?
Statement of Net Position:
- Shows the amount of BAN Payable remaining.
- May display totals across all funds, broken down by individual funds, or both.
- BANs redeemed from appropriations appear under Revenues or Other Financing Sources.
- Payments toward BANs are shown as Debt Service.
- Both Principal and Interest should be included. Note that this may also reflect payments toward Bonds.
Should provide details about the BANs, including:
- Beginning Balances
- Amounts Paid and Issued
- Ending Balance
- Total Interest Paid
Last Updated:
September 17, 2025