Gross Revenue Pledge

Gross Revenue Pledge

A provision in the indentures of some municipal bonds stating that the first priority of the revenue from the bond shall service debt or be set aside to pay the coupons to bondholders. The project a bond intends to finance is relegated to second place, and may be funded from other sources in addition to the bond. This places a difficulty on the issuer, but reduces the risk of default to bondholders. It also allows the bond to be issued at a lower interest rate, which is good for the issuer.
References in periodicals archive ?
Given that the project will reach full production within the next month and that the lenders have a gross revenue pledge, Standard & Poor's is comfortable affirming the rating at triple-'B' and maintaining the stable outlook.
The bonds are secured by a gross revenue pledge which includes tuition and unlimited student fees.
Though certificates are first secured by assessment levies, they are ultimately secured by a gross revenue pledge on virtually all flood control system revenues, which includes the district's portion of the county 1% property levy allocated to flood protection.
The trust indenture for the current bonds economically creates a gross revenue pledge for the senior bonds, after payments to an operating reserve.
AHS sells a portion of its accounts receivable, currently $425 million, which is not included in the gross revenue pledge and which reduce bondholders' security interest.
The bonds are supported by a gross revenue pledge, mortgage lien, and debt service reserve fund.
Still, despite the gross revenue pledge, rate-setting process, and strong bankruptcy protection language, the authority will face economic, operational, and political risks similar to other utility systems.
The security for the 2006 bonds remains a gross revenue pledge of CCSB.
Legal documents evidencing a gross revenue pledge that, following payment of project operating expenses, will pay senior debt service, replenish reserves, and other fees, and
STRONG FINANCIAL PERFORMANCE BUT HIGH EXPENSE PROFILE: Despite the gross revenue pledge, Fitch calculates senior and combined debt service coverage net of operating and capital expenses to be at least 2.
The bonds are secured by a Housing Assistance Payment contract from the Department of Housing and Urban Development for 87%, or 41 of 47, of the units and a gross revenue pledge.
The port's senior revenue bonds are secured by a gross revenue pledge of all port revenues, including the aviation (Oakland International Airport), maritime (Oakland Seaport), and commercial real estate divisions.