CHAPTER 15

Financing Basics

Revenue Bond Financings

Bonds, regardless of type or class, are financial instruments that are evidence of debt, a category of liability. In public finance, there are fundamentally two kinds of bonds: General Obligation Bonds (G.O.s) and Revenue Bonds.

G.O.s are secured by the full faith, credit, and taxing power of the bond issuer, commonly a state or political subdivision. The proceeds from the sale of the G.O. bonds may be used for any lawful purpose, as defined by state law.

Revenue Bonds are issued to finance a specific public purpose project that will generate income from one or more sources. The security for the Revenue Bonds is the pledge of the income stream generated by the use of the project.

The laws of ...

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