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Virginia Public School Authority

The Virginia Public School Authority operates several financing programs for public primary and secondary education. The goals of the VPSA's financing programs are to: provide market access to those communities which do not have ready access; provide low cost financing; and maintain the high credit quality to ensure that the lowest possible interest rates are obtained.

VPSA Programs and Business Activities

Pooled Bond Program - Tax Exempt Financing

VPSA provides financing to localities by using the proceeds of its bonds to purchase a "pool" of general obligation bonds from localities ("Local Issuers"). Each Local Issuer uses the proceeds to finance capital projects for public schools.

All local school divisions are invited to participate in the regularly scheduled pooled bond sales in the Spring and Fall of each year. Pooled bonds are issued by the VPSA under its 1997 Resolution and secured by the payments on general obligation school bonds ("Local School Bonds") purchased by the Authority. In the event of a default of any Local School Bond, a "State Aid Intercept" provision provides for a diversion to the holder of its local school bonds of all funds appropriated and payable to the Local Issuer by the Commonwealth.

Pooled bonds are additionally secured by a sum sufficient appropriation by the General Assembly to provide the difference, if any, between the debt service due on the VPSA bonds and the sum of (i) debt service payments made on the Local School Bonds and (ii) any funds obtained from enforcement of the State Aid Intercept provision.

Pooled bonds are rated AA+, Aa1 and AA+ by Fitch Ratings, Moody's and Standard & Poor's, respectively. The interest rates for the Local School Bonds are established at five basis points above the actual rates on VPSA's bonds. These five basis points are used to pay costs of issuance and other administrative expenses of the Authority.

Pooled Bond Program – Taxable Build America Bonds (BABs)

The issuance of BABs is authorized by the American Recovery and Reinvestment Act of 2009. The most popular variant (Direct Payment BABs) allows issuers to make an irrevocable election to receive a subsidy from the Federal Government equal to 35% of the interest due on each interest payment date.


  • Use of Proceeds: 100% of available construction proceeds must be used for capital expenditures (less amounts used for costs of issuance, which are capped at 2%);  this provides less flexibility than with traditional tax-exempt bonds
  • Limited Use for Refunding: Generally, Direct Payment BABS may not be used to refund previously issued tax-exempt bonds

Literary Fund Interest Rate Subsidy Program
Currently, this program is suspended.

Periodically, the Department of Education (DOE) and the Authority are directed to provide a program for funding school construction and renovation projects using interest rate subsidies from the Literary Fund. This program is normally conducted concurrently with the Fall pooled bond issue of the Authority. The program funds Literary Fund loan projects on DOE's first priority waiting list by subsidizing the Local Issuers' debt service cost from the Literary fund. In this way, localities would be paying no more than if they had received a direct Literary Fund loan. The interest rates on Literary Fund loans are based on the composition index, and can be as low as two percent.

Stand Alone Bond Program

Special Obligation School Financing Bonds have a "stand alone" security structure. Each series is secured separately and solely by the general obligation school bonds of the individual county or city requesting the financing.

School Educational Technology Notes

The Authority issues its School Educational Technology Notes to be used primarily to make grants to establish a computer-based instructional and testing system for the Standards of Learning (SOL) and to develop the capability for high speed Internet connectivity at high schools followed by middle schools followed by elementary schools. The notes are limited obligations of the Authority payable solely from appropriations by the General Assembly from the Literary Fund and backed by a sum sufficient appropriation from the General Fund of the Commonwealth.

Bond Policies

Statutory Requirements for Board Membership:

§ 22.1-164 et. seq. of the Code of Virginia establishes the membership of the Virginia Public School Authority (VPSA). The State Treasurer, the State Comptroller, the Superintendent of Public Instruction or his designee, and five additional members appointed by the Governor constitute the VPSA Board. The gubernatorial appointees serve at the pleasure of the Governor for six-year terms (except appointments to fill vacancies are for the unexpired terms). The Governor appoints the Chair of the VPSA.


Gubernatorial Appointees

Bonnie M. France
Term effective: July 1, 2016
Term expiration: June 30, 2022
Douglas Combs Jay Bhandari
Term effective: July 1, 2012
Term expiration: June 30, 2018
Term effective: July 1, 2014
Term expiration: June 30, 2020
Vik G. Murthy Cardell C. Patillo, Jr.
Term effective: July 1, 2016
Term expiration: June 30, 2022
Term effective: August 21, 2016
Term expiration: June 30, 2020


Manju S. Ganeriwala
David A. Von Moll
State Treasurer
Appointment effective: January 1, 2009
Serves at the Pleasure of the Governor
State Comptroller
Appointment effective: January 14, 2006
Serves at the Pleasure of the Governor
Dr. Steven R. Staples
Superintendent of Public Instruction
Appointment effective: May 1, 2014
Serves at the Pleasure of the Governor

Legal Counsel

Donald R. Ferguson
Sr. Assistant Attorney General
Office of the Attorney General
202 North Ninth Street
Richmond, VA 23219
(804) 786-0004

Staff Contacts

James D. Mahone
Public Finance Manager
Department of the Treasury
P.O. Box 1879
Richmond, VA 23218-1879
(804) 225-4928
Melissa W. Palmer Sandra E. Stanley
Senior Public Finance Analyst
Department of the Treasury
P.O. Box 1879
Richmond, VA 23218-1879
(804) 225-4926
Senior Public Finance Analyst
Department of the Treasury
P.O. Box 1879
Richmond, VA 23218-1879
(804) 225-2268


The information contained in the bond and investor relations area of this website should not be considered an offer to sell securities or a solicitation to buy securities.

The web pages contain information relating to bond financing programs of the Commonwealth. The purpose of this section is to provide general information about the Commonwealth, its debt management, and its borrowing programs. The information is provided for quick reference only and is not a summary or a compilation of information for any particular bond issue. It does not purport to include every item which may be of interest, nor does it purport to present full and fair disclosure within the meaning of applicable securities law with respect to any of the matters or programs addressed. Investment decisions should be made only after full review of the official statement and other relevant matters in connection with a particular bond issue.

The Department of Treasury is not responsible for the content of links to other Commonwealth Websites nor the Municipal Securities Rulemaking Board (MSRB) nor Electronic Municipal Market Access (EMMA)