A
municipal bond with the
coupon and
principal guaranteed both by the general
revenue of the municipality
issuing the bond and by the
revenue of the project the bond
finances. If the revenue from the project is less than expected and is not enough to make payments, the municipality will make them instead. A combination bond is intended to reduce the
risk to the bondholder to the least possible amount; therefore,
interest rates on them are fairly low. It is also called a double-barrel municipal bond.