Unsecured Loan, Unused Borrowing Capacity

[Table of Contents](#i3e760ad3c5f94c5892b7ddc949ade806_7)leverage ratio. The credit facility is guaranteed by certain subsidiaries of the Company and is subject to various financial covenants that require the Company to maintain certain financial ratios as defined in the credit facility agreement. As of June 30, 2022, the Company was in compliance with all such covenants. The revolving credit facility terminates February 10, 2025. There was $115,000 outstanding balance under this credit facility at June 30, 2022 and $100,000 outstanding balance under this credit facility at June 30, 2021. Other lines of creditThe Company has an unsecured bank credit line which provides for funding of up to $5,000 and bears interest at the prime rate less 1%. The credit line was renewed in May 2019 and modified in March 2021 to extend the expiration to April 30, 2023. There was no balance outstanding at June 30, 2022 or 2021. InterestThe Company paid interest of $1,788, $852, and $475 during the fiscal years ended June 30, 2022, 2021, and 2020, respectively.  
NOTE 8.    INCOME TAXESThe provision for income taxes consists of the following:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|   | Year Ended June 30, |
|   | 2022 |  | 2021 |  | 2020 |
| Current: |   |  |   |  |   |
| Federal | $ | 59,390  |  |  | $ | 55,598  |  |  | $ | 46,137  |  |
| State | 18,089  |  |  | 13,897  |  |  | 13,690  |  |
| Deferred: |  |  |  |  |   |
| Federal | 24,391  |  |  | 14,401  |  |  | 21,130  |  |
| State | 7,481  |  |  | 2,360  |  |  | 3,451  |  |
|   | $ | 109,351  |  |  | $ | 86,256  |  |  | $ | 84,408  |  |

The tax effects of temporary differences related to deferred taxes shown on the balance sheets were:

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
|   | June 30, |
|   | 2022 |  | 2021 |
| Deferred tax assets: |   |  |   |
| Contract and service revenues | $ | 15,340  |  |  | $ | 13,428  |  |
| Expense reserves and accruals (bad debts, compensation, and payroll tax) | 15,382  |  |  | 17,566  |  |
| Leasing liabilities | 12,868  |  |  | 15,182  |  |
| Net operating loss and tax credit carryforwards | 2,107  |  |  | 3,242  |  |
| Other, net | 3,311  |  |  | 2,634  |  |
| Total gross deferred tax assets | 49,008  |  |  | 52,052  |  |
| Valuation allowance | (200) |  |  | (270) |  |
| Net deferred tax assets | 48,808  |  |  | 51,782  |  |
|  |  |  |  |
| Deferred tax liabilities: |   |  |   |
| Accelerated tax depreciation | (33,390) |  |  | (37,066) |  |
| Accelerated tax amortization | (192,187) |  |  | (175,804) |  |
| Contract and service costs | (104,139) |  |  | (85,696) |  |
| Leasing right-of-use assets | (11,722) |  |  | (13,974) |  |
| Total gross deferred liabilities | (341,438) |  |  | (312,540) |  |
|  |  |  |  |
| Net deferred tax liability | $ | (292,630) |  |  | $ | (260,758) |  |

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