Each year, the Idaho State Treasurer's Office borrows money to cover expenses during the dry period before tax revenue starts flowing before the April 15 deadline.
The state sells Tax Anticipation Notes to cover short-term expenses during the months when tax revenues are low. The money holds the state over until revenue resumes flowing during tax season.
This year, the Treasurer's Office sold $500 million worth of notes at a record-low interest rate of 0.19 percent.
The state secures low interest rates because it reliably pays its debts each year, said Shawn Nydegger, investment officer for the office. The notes are bought by large mutual fund managers such as Vanguard and Fidelity Investments.
"A lot (of the low interest rate) has to do with fiscal conservativeness," Nydegger said. "By law, we have to have a balanced budget at the end of the year, which rating agencies look upon with favor."