Revenue bond

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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.
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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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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 ?
KBRA views the legal framework of Sales Tax Revenue Bonds structure, the deep and diverse economic base supporting retail activity and the strong MADS coverage as critical factors supporting bondholder security.
--$43 million tourism, recreation, cultural, and convention (TRCC) sales tax revenue bonds, series 2017;
5 June 2013 -- German financial services firm Deutsch bank's Deutsche Asset & Wealth Management unit said it has launched the db X-trackers Municipal Infrastructure Revenue Bond Fund (NYSE Ticker: RVNU) and the db X-trackers Regulated Utilities Fund (NYSE Ticker: UTLT).
Municipal infrastructure financings most commonly come to market in the form of revenue bond issuance.
Revenue bonds have become more common in recent decades as resistance to property taxes has intensified and as local governments adopted the philosophy that users should finance facilities through fees.
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.
Their opposition might be overcome if the proposal were narrowly drawn: applying only to new revenue bonds, and only for these specific kinds of infrastructure.
Today, we're focusing La Quinta's financial efforts on reducing the interest rates on some of our debt, particularly on the industrial revenue bonds.
These are as follows:--$147 million utility revenue bonds, series 2010, to 'A+' from 'A'; and --$18 million subordinate utility revenue bonds, series 2010 to 'A' from 'A-'.
The series 2007 bonds consist of the following: USD195m airport system revenue bonds series 2007A (AMT); USD25m airport system revenue bonds series 2007B (Non-AMT); USD150m airport system revenue bonds series 2007C (Non-AMT) (Market dependent revenue bonds); USD188m airport system revenue bonds series 2007D (AMT); USD49m airport system revenue bonds series 2007E (Non-AMT).
The California Department of Water Resources initiated the largest municipal bond sale in history October 23 by selling $4.25 billion worth of floating-rate power purchase revenue bonds. The DWR issued an additional $6.3 billion of tax-exempt, fixed-rate revenue bonds and $710 million in taxable revenue bonds during the first week of November.