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CITY OF EUGENE, OREGON <br />Notes to Basic Financial Statements <br />(4) Detailed Notes on All Funds, continued <br />(I) Noncurrent Liabilities. continued <br />Rebatable Arbitrage <br />The City rebates interest earned on arbitrage as required by the federal tax code. Arbitrage reviews are <br />performed periodically on all City tax-exempt bonds and obligations, and material liabilities are recorded in <br />proprietary funds when incurred. The City had an estimated rebatable arbitrage of $291,902 at June 30, 2008. <br />Reserves, accumulated from excess interest revenues in the General Capital Projects Fund and the Library <br />Debt Service Fund, will be used to liquidate the liabilities when due. <br />Compensated Absences <br />At June 30, 2008, the City reported compensated absences of $8,224,249 in governmental activities. The <br />General Fund, internal service funds, and other governmental funds are typically used to liquidate these <br />liabilities. <br />Internal Service Fund Debt <br />Based on an analysis of billings, governmental activities have been determined to be the predominant source <br />of revenue for all internal service funds. Therefore, noncurrent liabilities of the internal service funds are <br />reported in governmental activities. A's of June 30, 2008, internal service fund debt included the Atrium <br />Obligations of $1,540,000, Limited Tax Pension Bonds of $64,291,456, deferred bond discounts net of <br />premiums of $148,451, and $955,623 in compensated absences. <br />continued <br />66 <br />