backdoor borrowing

Backdoor Borrowing

The act of a government borrowing without voter approval. This may or may not occur after the voters have refused to authorize a bond issue. The practice is controversial as it implies a lack of transparency in government actions and forces taxpayer money to be used to repay debt that voters did not want.
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backdoor borrowing

Borrowing by a public authority without voter approval. Public authorities often use backdoor borrowing when voters reject proposed debt issues. Taxpayer funds are used to repay debt accumulated in backdoor borrowing.
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.
References in periodicals archive ?
The least we could do is to admit to this backdoor borrowing.
Some of the issues that could be considered during a People's Convention include much-needed fiscal reforms, such as a property tax and state spending cap, debt reform, and a ban on backdoor borrowing. Also on a possible to-do list for a People's Convention are "good government" reforms, such as an independent legislative redistricting commission--which would result in elections that are fairer and more competitive--initiative and referendum, term limits for legislative leaders, and, critically important, a clear and orderly succession plan for state offices, as Grumet advocated for throughout his column.