The advent of a new calendar year means many things. For municipalities with outstanding bank loans or interest rate swaps, 2020 may be the year when many first hear about the long-planned phase-out of the London Interbank Offered Rate (LIBOR).

Don’t feel bad if you haven’t heard about the LIBOR phase-out, or even if you don’t know what LIBOR is. LIBOR is a benchmark interest rate used globally by financial institutions to set interest rates in loan documents. In the United States, LIBOR is used for nearly all commercial and consumer financial products, ranging from mortgages to student loans. It is also routinely used to set interest rates on municipal debt obligations and related interest rate swaps. In fact, it is estimated that trillions of dollars of transactions are based, in whole or in part, on LIBOR.