Revenue bond

A bond issued by a municipality to finance either a project or an enterprise in which the issuer pledges to the bondholders the revenues generated by the operation of the projects financed. Examples are hospital revenue bonds and sewer revenue bonds.

Revenue Bond

A municipal bond that is not secured by the issuer's general revenue but instead by the revenue of the project it intends to finance. For example, a city may issue a revenue bond to finance improvements to the local sewer system. It expects to be able to pay back the bond with money raised from citizens' water bills. Generally speaking, a revenue bond is riskier than other municipal bonds because the project has no power to tax on its own. However, it is usually a fairly safe investment. See also: Authority Bond.

revenue bond

A municipal debt on which the payment of interest and principal depends on revenues from the particular asset that the bond issue is used to finance. Examples of such projects are toll roads and bridges, housing developments, and airport expansions. Revenue bonds are generally considered of lower quality than general obligation bonds, but there is a great amount of variance in risk depending on the particular assets financed. Compare authority bond.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Revenue bond.

Revenue bonds are municipal bonds issued to finance public projects, such as airports and roadways. The bonds are backed by revenue to be generated by the project.

For example, if the construction of a tunnel is financed with municipal revenue bonds, the tolls paid by motorists are used to pay back the bondholders. However, bondholders usually have no claims on the bond issuer's other assets or resources.

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References in periodicals archive

--$137 million sales tax revenue bonds, series 2010D, 2012A, 2014, 2017A, and 2017B;

Fitch Rates Municipal Building Auth of Salt Lake County, UT's $42MM Lease Revs 'AA+'; Outlook Stable

According to Deutsch, the RVNU is the only exchange-traded fund on the market offering investors targeted access to municipal infrastructure revenue bonds and UTLT is first ETF to provide investors with 100% exposure to regulated utilities.

-Deutsche Asset & Wealth Management launches 2 ETFs

Revenue Bonds - Including Infrastructure Bonds - May Provide Credit Stability - Essential-purpose revenue bonds may be less impacted in weaker economic periods than general obligation bonds, and may possibly benefit with service usage increases during times of economic growth.

-Aging U.S. Infrastructure and Growing Population Fuel Need for New Construction Financed through Municipal Bonds, Says BNY Mellon's Standish

The operations center would be financed by revenue bonds, which would be repaid with money from a 2.6 percent increase in water and electric rates.

Bad timing for bond vote

Zions Bank, based in Salt Lake City, sought permission last April to underwrite revenue bonds in an operating subsidiary under an OCC rule approved in November of 1996.

Feds okay banks to sell municipal revenue bonds: move would aid cities, towns

The 'AA-' IDR and revenue bond rating reflect Fitch's view of SCH's strong financial profile as evidenced by ample liquidity and strong leverage metrics.

Fitch Ratings assigns 'AA-' rating to Mt. Lebanon Hospital Authority bonds

Grace Townhomes: On May 23, CharterMac acquired a $5,225,600 tax-exempt Multifamily Housing Revenue Bond from the Housing Finance Corporation of Ennis to finance the construction of Grace Townhomes, a 112-unit multifamily affordable housing apartment complex located in Ennis, Texas.

Newark Commons

The floating interest revenue bonds, maturing in June 2016, have been placed as part of the company's PLN60m tram revenue bond programme.

-Fitch rates ZKM Gdansk PLN11.2m bus revenue bond at BBB/A+(pol)

* Jones Resource Group Inc., Ashley County, $355,000 in taxable economic development revenue bonds and $455,000 in tax-exempt economic development revenue bonds to buy equipment and build a new warehouse that it estimates will employ up to 34 new employees.

ADFA bond issue to aid 5 manufacturers in state

CBS, which at one time was negotiating to build on the Trump commercial land at Trump Place and talking to New Jersey land owners, is now preparing to make the technological changes at its current spaces by requesting exemptions from sales and use taxes for 507-530 West 57th Street, 513 West 56th Street, 1697 Broadway, and 851-3 and 855-9 Tenth Avenue through a $50 million IDA revenue bond action.

New Year's help offered to big tenants

The floating interest revenue bonds, due in 2024, have been placed as part of a PLN220m tram revenue bond programme, with coupons on the issue payable twice a year.

-ZKM Gdansk gets BBB/A+(pol) ratings from Fitch for PLN37.9m bond

8 April 2011 - Fitch placed yesterday on "negative" watch the long-term local currency rating of BBB- assigned to the revenue bond of Miejskie Przedsiebiorstwo Komunikacyjne - Lodz, which services as operator of the Lodzki Tramwaj Regionalny (LTR) tram line in the Polish central city of Lodz.

-MPK Lodz revenue bond rating examined by Fitch for possible downgrade