KENTUCKY STATE UNIVERSITY NOTES TO FINANCIAL STATEMENTS June 30, 2019

NOTE 5 - UNEARNED REVENUE

Unearned revenue consists of the following as of June 30, 2019:

Unearned summer school tuition and fees $ 178,122

Unearned grants and contracts 6,370

$ 184,492

NOTE 6 – LINE OF CREDIT

During fiscal year 2019, the University entered into a line of credit agreement with Fifth Third Bank for a maximum borrowing amount of $2,062,500, maturing on June 30, 2019. At June 30, 2019, borrowings on the line of credit totaled $2,061,650. The line bears interest at the Adjusted LIBOR rate and the interest rate at June 30, 2019 was 4.05%. The agreement was renewed as of July 1, 2019, increasing the maximum borrowing amount to $5,000,000, maturing on June 30, 2020.

NOTE 7 – LONG-TERM LIABILITIES

Long-term liabilities as of June 30, 2019, are summarized as follows:

Beginning BalanceAdditionsReductionsEnding BalanceCurrent PortionNon-current Portion
Debt
General receipts bonds$ 2,525,000$ -$ 240,000$ 2,285,000$ 250,000$ 2,035,000
Bond discount(36,345)-(4,484)(31,861)(4,484)(27,377)
Total bonds2,488,655-235,5162,253,139245,5162,007,623
Direct borrowing debt
Note payable – City of
Frankfort50,000-50,000---
Total bond payable and note obligations2,538,655-285,5162,253,139245,5162,007,623
Other long-term liabilities
Capital lease obligations - energy savings1,719,037-548,8701,170,167572,669597,498
Federal grants refundable596,898-39,056557,842-557,842
Total long-term liabilities$ 4,854,590$ -$ 873,442$ 3,981,148$ 818,185$ 3,162,963

The outstanding General Receipts Bonds Series A Bonds have interest rates from 3.625% - 3.875%. The bonds mature through 2027. The reserve requirements for these issues have been fully funded as of June 30, 2019.

All bonds are collateralized by University property and the pledge of certain revenues, tuition and fees.

The net book value of assets acquired through the capital leases included in the above schedule was $2,269,790 as of June 30, 2019.

In 2009, the University signed a 10-year promissory note with the City of Frankfort, for the purchase of real property. The note payable was paid in full at June 30, 2019.

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