GASB issued a new standard for state and local government to apply when accounting for extinguishment of debt prior to its maturity.
In Statement No. 86, Certain Debt Extinguishment Issues, GASB establishes rules for accounting for transactions in which cash and other monetary assets acquired with only existing resources are place in an irrevocable trust for the sole purpose of extinguishing debt.
Current GASB standards already provide guidance for accounting and reporting when cash and other monetary assets acquired with the proceeds of refunding bonds are placed in a trust for the future repayment of outstanding debt.
You can read the Journal of Accountancy story here.