future debt service payments on the portion of the Series 1990 Bonds being advanced refunded and which were subsequently paid in
March 2000. As a result, $5,430,000 of the Series 1990 Bonds were considered to be defeased, and the liability for those bonds was
removed from revenue bonds and notes payable.

The advance refunding resulted in an excess of the reacquisition price over the net carrying amount of the old debt of $392,000.
This difference, reported as a deduction from bonds payable, is being amortized to interest expense through the year 2010. The
Service completed the advance refunding to reduce its total debt service payments over the next 11 years by $435,000 and to obtain
an economic gain of $495,000.

Subsequent of June 30,2000, the Service issued $6,385,000 in Cecil County Landfill Project Revenue Bonds Series 2000 (Series
2000 Bonds) with interest rate of 4.8% to 5.5%. These bonds constitute special obligations of the Service payable solely from
revenues (sublease payments) from the project pledged by bond indenture.

10. Loans from Primary Government:

Component Units - Maryland Food Center Authority (Authority) -

The State loaned the Authority $4,000,000, which the Authority is obligated to repay after all principal and interest has been
paid on any revenue bonds which may be issued by the Authority. The loan accrued interest until June 30,1993. The outstanding
balance as of June 30,2000, including deferred interest of $1,577,000 was $5,577,000.

The Authority assumed a non-interest bearing obligation in the amount of $795,000 due to the debt service fund of the primary
government pursuant to the transfer of the assets and obligations of the New Marsh Market to the Authority. The Authority is
obligated to repay the debt service fund after all principal and interest has been paid on any revenue bonds which may be issued by
the Authority. The outstanding principal as of June 30,2000, is $795,000.

Component Units - Maryland Pre-Paid College Trust (Trust) -

During the fiscal year ended June 30, 2000, the Trust was granted a loan of $250,000 from the Maryland Higher Education
Commission (MHEC). Additionally, in fiscal year 1999, the Trust was granted and received additional loans totaling $400,000, of
which $30,000 has been repaid. The loans are non-interest bearing. During the 2000 legislative session, the General Assembly
included a provision in the annual budget bill which permits the Trust to delay its outstanding loan repayments until the Trust is
financially self-sufficient.

11. Insurance:

The self-insurance liabilities represent the State's liability for its various self-insurance programs. The State is self-insured for
general liability, property and casualty, workers' compensation, environmental and anti-trust liabilities and certain employee health
benefits. Commercial insurance coverage is purchased for specialized exposures such as aviation hull and liability, steam boiler
coverage and certain transportation risks. There were no significant reductions or changes in the commercial insurance coverage
from the prior year, and the amount of settlements have not exceeded insurance coverage for any of the past three fiscal years.

All funds, agencies and authorities of the State participate in the self-insurance program (Program). The Program, which is
accounted for in the general fund, allocates the cost of providing claims servicing and claims payment by charging a "premium" to
each fund, agency or public authority, based on a percentage of each organization's estimated current-year payroll or based on an
average loss experienced by each organization. This charge considers recent trends in actual claims experience of the State as a whole
and makes provision for catastrophic losses.

The Program's liabilities are reported when it is probable that a loss has occurred and the amount of that loss can be reasonably
estimated. Liabilities include an amount for claims that have been incurred but not reported. Because actual claims liabilities depend
on such complex factors as inflation, changes in legal doctrines, and damage awards, actual claims paid could differ from these
estimates. Claims liabilities are reevaluated periodically to take into consideration recently settled claims, the frequency of claims and
other economic and social factors. Liabilities for incurred workers' compensation losses to be settled by fixed or reasonably
determinable payments over a long period of time are reported at their present value using a 4.0% discount rate. The workers'
compensation and property and casualty costs are based upon separately determined actuarial valuations for the fiscal years ending.
The employee health benefits liability is calculated based on claims subsequently reported and claims trends.

Changes in the self-insurance liabilities during fiscal year 2000 were as follows (amounts expressed in thousands).

	Beginning-of-	Claims and		End-of-
	Fiscal-Year	Changes in	Claim	Fiscal-Year
	Liability	Estimates	Payments	Liability
Property, Casualty and General Liability.. ...... ...................	................... $ 8,626	$ 6,241	$ 6,191	$ 8,676
Workers' Compensation ....................................................	................... 159,000	47,020	34,020	172,000
Employee Health Benefits ................................................	................... 39,315	360,990	356,264	44,041
Total Self-Insurance Costs ................................................	................... $206,941	$414,251	$396,475	$224,717

As of June 30,2000, the Program held $173,152,000, in cash and investments designated for payments of these claims.

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