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2014 Financial Report of the United States Government


Notes to the Financial Statements

Note 12. Federal Debt Securities Held by the Public and Accrued Interest

Federal Debt Securities Held by the Public and Accrued Interest
(In billions of dollars)
Balance
September 30,
2013
Net
Change
During
Fiscal
Year
2014
Balance
September 30,
2014
Average Interest
Rate
2014
2013
Treasury securities (public):
Marketable securities:
  Treasury bills 1,527.9 (118.3) 1,409.6 0.1% 0.1%
  Treasury notes 7,750.3 409.9 8,160.2 1.8% 1.8%
  Treasury bonds 1,363.1 171.0 1,534.1 4.9% 5.1%
  Treasury inflation-protected securities (TIPS) 963.1 108.6 1,044.7 0.9% 1.1%
  Treasury floating rate notes (FRN) - 123.0 123.0 0.1% -
Total marketable Treasury securities 11,577.4 694.2 12,271.6    
Nonmarketable securities 398.9 114.5 513.4 2.3% 2.4%
  Net unamortized premiums/(discounts) (24.5) (4.9) (29.4)    
Total Treasury securities, net (public) 11,951.8 803.8 12,755.6    
Agency securities:
  Tennessee Valley Authority 24.8 (1.2) 23.6    
  All other agencies 0.2 - 0.2    
Total agency securities, net of
unamortized premiums and discounts
25.0 (1.2) 23.8    
Accrued interest payable 51.6 (2.6) 54.2    
  Total federal debt securities
    held by the public and
    accrued interest
12,028.4 805.2 12,833.6    
Types of marketable securities:
Bills—Short-term obligations issued with a term of 1 year or less.
Notes—Medium-term obligations issued with a term of 2 - 10 years.
Bonds—Long-term obligations of more than 10 years.
TIPS—Term of more than 5 years.
FRN—Term of 2 years.

Federal debt securities held by the public outside the Government are held by individuals, corporations, state or local governments, FRBs, foreign governments, and other entities outside the federal government. The above table details government borrowing primarily to finance operations and shows marketable and nonmarketable securities at face value less net unamortized premiums and discounts including accrued interest.

Securities that represent federal debt held by the public are issued primarily by the Treasury and include:

  • Interest-bearing marketable securities (bills, notes, bonds, inflation-protected, and floating rate notes).
  • Interest-bearing nonmarketable securities (government account series held by deposit and fiduciary funds, foreign series, state and local government series, domestic series, and savings bonds).
  • Non-interest-bearing marketable and nonmarketable securities (matured and other).

Section 3111 of Title 31, United States Code (U.S.C.) authorizes the Secretary of the Treasury to use money received from the sale of an obligation and other money in the General Fund of the Treasury to buy, redeem, or refund, at or before maturity, outstanding bonds, notes, certificates of indebtedness, Treasury bills, or savings certificates of the Government. There were no buyback operations in fiscal years 2014 and 2013.

Gross federal debt (with some adjustments) is subject to a statutory ceiling (i.e., the debt limit). Prior to 1917, Congress approved each debt issuance. In 1917, to facilitate planning in World War I, Congress and the President first enacted a statutory dollar ceiling for federal borrowing. With the Public Debt Act of 1941 (Public Law No. 77-7), Congress and the President set an overall limit of $65 billion on Treasury debt obligations that could be outstanding at any one time; since then, Congress and the President have enacted a number of debt limit increases.

Most recently, Treasury faced two delays in raising the statutory debt limit that required it to depart from its normal debt management operations and to invoke legal authorities to avoid exceeding the statutory debt limit. During each of these periods, extraordinary measures taken by Treasury resulted in federal debt securities not being issued to certain federal accounts. The first occurred from May 20, 2013 through October 16, 2013. As such, a delay in raising the statutory debt limit existed as of September 30, 2013. The $120.4 billion of uninvested principal of, and related interest for, the Thrift Saving Plan (TSP) G Fund that would have been reported as Federal Debt Securities Held by the Public and Accrued Interest, had there not been a delay in raising the statutory debt limit as of September 30, 2013, and had the securities been issued, were reported as miscellaneous liabilities. On October 17, 2013, the Continuing Appropriations Act, 2014 (Public Law No. 113-46) was enacted which temporarily suspended the statutory debt limit through February 7, 2014. Treasury subsequently restored the uninvested principal and related interest, resulting in an increase in federal debt securities held by the public from 2013 to 2014. See Note 17, Other Liabilities for more information. On February 8, 2014, the debt limit was raised to $17,211.6 billion. The second occurred from February 10, 2014, through February 14, 2014. On February 15, 2014, Congress enacted the Temporary Debt Limit Extension Act (Public Law No. 113-83) which temporarily suspended the debt limit through March 15, 2015.

As of September 30, 2014, and 2013, debt subject to the statutory debt limit was $17,781.1 billion and $16,699.4 billion, respectively. The debt subject to the limit includes Treasury securities held by the public and government guaranteed debt of federal agencies (shown in the table above), and intragovernmental debt holdings (shown in the following table). See Note 17—Other Liabilities and Note 23—Fiduciary Activities for additional information.

Intragovernmental Debt Holdings: Federal Debt Securities
Held as Investments by Government Accounts as of September 30, 2014, and 2013
(In billions of dollars)
Balance
2013
Net
Change
During
Fiscal Year
2014
Balance
2014
Social Security Administration, Federal Old-Age and Survivors Insurance Trust Fund 2,655.6 57.2 2,712.8
Office of Personnel Management, Civil Service Retirement and Disability Fund 719.4 137.8 857.2
Department of Defense, Military Retirement Fund 421.3 61.8 483.1
Department of Health and Human Services, Federal Hospital Insurance Fund 206.0 (3.8) 202.2
Department of Defense, Medicare-Eligible Retiree Health Care Fund 188.7 11.7 200.4
Social Security Administration, Federal Disability Insurance Trust Fund 100.8 (30.7) 70.1
Department of Health and Human Services, Federal Supplementary Medical Insurance Trust Fund 67.4 1.0 68.4
Department of Energy, Nuclear Waste Disposal Fund 50.6 0.9 51.5
Federal Deposit Insurance Corporation Funds 37.7 11.9 49.6
Office of Personnel Management, Postal Service Retiree Health Benefits Fund 42.3 6.2 48.5
Office of Personnel Management, Employees Life Insurance Fund 42.0 1.2 43.2
Department of Labor, Unemployment Trust Fund 29.5 6.4 35.9
Office of Personnel Management, Employees Health Benefits Fund 23.4 0.2 23.6
Department of the Treasury, Exchange Stabilization Fund 22.7 (0.1) 22.6
Department of State, Foreign Service Retirement and Disability Fund 17.4 0.4 17.8
Pension Benefit Guaranty Corporation Fund 22.6 (5.2) 17.4
Department of Transportation, Airport and Airway Trust Fund 11.8 1.0 12.8
National Credit Union Share Insurance Fund 10.6 0.4 11.0
Department of Transportation, Highway Trust Fund 2.0 8.7 10.7
All other programs and funds 90.1 10.2 100.3
Subtotal 4,761.9 277.2 5,039.1
Total Net Unamortized Premiums/(Discounts) for Intragovernmental 69.4 (1.6) 67.8
Total intragovernmental debt holdings, net 4,831.3 275.6 5,106.9

Intragovernmental debt holdings represent the portion of the gross federal debt held as investments by government entities such as trust funds, revolving funds, and special funds. As noted above, the delay in raising the debt limit still existed as of September 30, 2013. On October 17, 2013, the Continuing Appropriations Act, 2014 (Public Law No. 113-46), was enacted, which temporarily suspended the statutory debt limit through February 7, 2014. Treasury subsequently restored uninvested principal and related interest, resulting in an increase to the Civil Service Retirement and Disability Fund from 2013 to 2014.

Government entities that held investments in Treasury securities include trust funds that have funds from dedicated collections. For more information on funds from dedicated collections, see Note 22—Funds from Dedicated Collections. These intragovernmental debt holdings are eliminated in the consolidation of these financial statements.

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