NOTE 6. CONSOLIDATED DEBT

Consolidated debt is as follows (in millions):



	As of
	September 30, 2016			December 31, 2015
LONG-TERM DEBT:
Revolving credit facility (2.95% - 3.20%)⁽¹⁾	$	384		$	348
Term loan, net (2.45%)	198			200
Credit Facilities Sub-total	$	582		$	548
7.25% Senior notes due 2020	$	400		$	400
6.375% Senior notes due 2022	400			400
5.875% Senior notes due 2024	400			400
Less: deferred financing costs related to senior notes	(15		)	(16		)
Senior Notes Sub-total	$	1,185		$	1,184
4.00% - 5.25% Tax-exempt bonds due 2024 through 2045	$	464		$	464
Less: deferred financing costs related to tax-exempt bonds	(5		)	(6		)
Tax-Exempt Bonds Sub-total	$	459		$	458
3.48% - 4.52% Equipment financing capital leases due 2024 through 2027	$	69		$	73
Total long-term debt	$	2,295		$	2,263
Less: current portion	(9		)	(8		)
Noncurrent long-term debt	$	2,286		$	2,255
PROJECT DEBT:
North America project debt:
1.75% - 6.45% project debt related to service fee structures due 2017 through 2035	$	108		$	117
5.00% Union capital lease due 2016 through 2053	101			—
5.248% - 6.20% project debt related to tip fee structures due 2016 through 2020	16			23
Unamortized debt premium, net	4			5
Less: deferred financing costs related to North America project debt	(1		)	(1		)
Total North America project debt	$	228		$	144
Other project debt:
Dublin senior loan due 2021 (5.72% - 6.41%)⁽²⁾	$	142		$	—
Debt discount related to Dublin senior loan	(7		)	(8		)
Less: deferred financing cost related to Dublin senior loan	(19		)	(15		)
Dublin senior loan, net	$	116		$	(23	)
Dublin junior loan due 2022 (9.23% - 9.73%)	$	61		$	57
Debt discount related to Dublin junior loan	—			(1		)
Less: deferred financing costs related to Dublin junior loan	(1		)	(2		)
Dublin junior loan, net	$	60		$	54
Total other project debt, net	$	176		$	31
Total project debt	$	404		$	175
Less: Current portion, includes $1 of net unamortized premium	(23		)	(16		)
Noncurrent project debt	$	381		$	159
TOTAL CONSOLIDATED DEBT	$	2,699		$	2,438
Less: Current debt	(32		)	(24		)
TOTAL NONCURRENT CONSOLIDATED DEBT	$	2,667		$	2,414
⁽¹⁾ Eurodollar rates only; excludes base rate borrowings.
⁽²⁾ Reflects hedged fixed rates.

Credit Facilities

Our subsidiary, Covanta Energy, has $1.2 billion in senior secured credit facilities consisting of a $1.0 billion revolving credit facility, expiring 2019 through 2020, (the “Revolving Credit Facility”) and a $200 million term loan due 2020 (the “Term Loan”) (collectively referred to as the "Credit Facilities").

Availability under Revolving Credit Facility

As of September 30, 2016, we had availability under the Revolving Credit Facility as follows (in millions):



	Total Available Under Credit Facility		Expiring ⁽¹⁾	Direct Borrowings as of September 30, 2016		Outstanding Letters of Credit as of September 30, 2016		Availability as of September 30, 2016
Revolving Credit Facility	$	1,000	2020	$	384	$	148	$	468

(1) The Revolving Credit Facility consists of two tranches; Tranche A ($950 million), which expires in 2020, and Tranche B ($50 million), which expires in March 2019.

Repayment Terms

As of September 30, 2016, the Term Loan has mandatory remaining amortization payments of $1 million in 2016, $5 million in each of the years 2017 through 2019 and $182 million in 2020. The Credit Facilities are pre-payable at par at our option at any time.

Guarantees and Security

The Credit Facilities are guaranteed by us and by certain of our subsidiaries. The subsidiaries that are party to the Credit Facilities agreed to secure all of the obligations under the Credit Facilities by granting, for the benefit of secured parties, a first priority lien on substantially all of their assets, to the extent permitted by existing contractual obligations; a pledge of substantially all of the capital stock of each of our domestic subsidiaries and 65% of substantially all the capital stock of each of our foreign subsidiaries which are directly owned, in each case to the extent not otherwise pledged.

Credit Agreement Covenants

The loan documentation governing the Credit Facilities contains various affirmative and negative covenants, as well as financial maintenance covenants (financial ratios), that limit our ability to engage in certain types of transactions. We were in compliance with all of the affirmative and negative covenants under the Credit Facilities as of September 30, 2016.

Union County EfW Capital Lease Arrangement

In June 2016, we extended the lease term related to the Union County EfW facility through 2053, which resulted in capital lease treatment for the revised lease. We recorded lease liability of $104 million, calculated utilizing an incremental borrowing rate of 5.0%. The lease includes certain periods of contingent rentals based upon plant performance as either a share of revenue or a share of plant profits. These contingent payments have been excluded from the calculation of the lease liability and instead will be treated as a period expense when incurred. As of September 30, 2016, the outstanding borrowings under the capital lease have mandatory amortization payments remaining as follows (in millions):



	Remainder of 2016		2017		2018		2019		2020		Thereafter
Annual Remaining Amortization	$	2	$	5	$	5	$	5	$	6	$	78

Other Non-current Liabilities

As of September 30, 2016, the Dublin convertible preferred instrument of $91 million was included in other noncurrent liabilities in our condensed consolidated balance sheet.

Capitalized Interest

Interest expense paid and costs amortized to interest expense related to project financing are capitalized during the construction and start-up phase of the project. Total interest expense capitalized was $7 million and $2 million during the three months ended September 30, 2016 and 2015, respectively, and $20 million and $4 million during the nine months ended September 30, 2016 and 2015, respectively.