C. Component Units:

Property, plant and equipment of the discretely presented Component Units, as of June 30,1997, consists of the
following (amounts expressed in thousands).

	Higher Education Fund	Proprietary Funds
Land and improvements (proprietary funds include $1,378 of land held
for development)..................................................................................	$ 216,760	$ 4,451
Structure and improvements..................................................................	2,048,006	41,791
Equipment...........................................................................................	573,246	12,314
Construction in progress .......................................................................	185,722	66
	3,023,734	58,622
Less: accumulated depreciation ...........................................................		24,786
Total...................................................................................................	$3,023,734	$ 33,836

9. Long-Term Obligations

A. General Long-Term Debt:

Changes in general long-term debt, for the year ended June 30, 1997, are as follows (amounts expressed in
thousands).

Total

Long-Term
Obligations

Balance, July 1, 1996........................	General Obligation Bonds .. $2,859,939	Transportation Bonds $979,880	Maryland Transportation Authority Bonds $408,431	Accrued Self- Insurance Costs $115,366	C Accrued Annual Leave $146,694	)bligations Under Capital Leases $ 99,840	Obligations Under Capital Leases with Component Units $213,396	Total Long-Term Obligations $4,823,546
Bond issuances.................................	.. 410,000	50,000						460,000
Bond accretion ..................................			3,287					3,287
New obligations under capital
leases...............................................						6,599	55,601	62,200
Reduction in bond principal...........	.. (244,545)	(94,525)	(19,780)					(358,850)
Retirements of obligations under
capital leases...... ...........................						(20,592)	(1,804)	(22,396)
Net increase in accrued self-
insurance costs..............................				8,529				8,529
Net decrease in accrued annual
leave...............................................					(2,354)			(2,354)
Balance, June 30, 1997 ....................	.. $3,025,394	$935,355	$391,938	$123,895	$144,340	$ 85,847	$267,193	$4,973,962

General Obligation Bonds ?

General obligation bonds are authorized and issued primarily to provide funds for State owned capital
improvements, including facilities for institutions of higher education and the construction of public schools in
political subdivisions. Bonds have also been issued for local government improvements, including grants and loans
for water quality improvement projects and correctional facilities, and to provide funds for loans or outright grants
to private, not-for-profit cultural or educational institutions. Under constitutional requirements and practice, the
Maryland General Assembly, by a separate enabling act, authorizes loans for particular objects or purposes.
Thereafter, the Board of Public Works, a constitutional body comprised of the Governor, the Comptroller of the
Treasury and the State Treasurer, by resolution, authorizes the issuance of bonds in specified amounts for part or
all of the loans authorized by particular enabling acts.

General obligation bonds, which are paid from the general obligation debt service fund, are backed by the full
faith and credit of the State and, pursuant to the State Constitution, must be fully paid within 15 years from the
date of issue. Property taxes, debt service fund loan repayments and general fund appropriations provide the
resources for repayment of general obligation bonds. During fiscal year 1997, the State issued $410,000,000 of
general obligations with related issuance costs of $174,000.

Bonds issued after January 1, 1988, are subject to redemption provisions at the option of the State.

As of June 30, 1997, the State has $310,515,000 of defeased debt outstanding, none of which was defeased
during the year ended June 30, 1997.

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