Revenue bond

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Related to limited obligation bond: Moral obligation bond, Limited Tax General Obligation Bond

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 ?
--$23 million limited obligation bonds series 2014 at 'AA+';
--$35 million taxable limited obligation bonds (Downtown Multi-Use Sports and Entertainment Facility Project) series 2018.
Moody's maintains a Aa2 rating on the town's $42.2 million of outstanding general obligation debt and Aa3 rating on $7.9 million of outstanding Limited Obligation Bonds, Series 2012.
New York: Fitch Ratings has assigned an 'AA+' rating to the following Wilmington, NC limited obligation bonds (LOBs):
Concurrently we have affirmed the Aa1 on the county's $208 million of outstanding limited obligation bonds and certificates of participation and the Aaa on the county's $270 million outstanding general obligation bonds.
The 2016 Refunding Limited Obligation Bonds will refund the outstanding 2009A Limited Obligation Bonds for an expected net present value savings in excess of 9% without extending debt maturity.
New York: Issue: Limited Obligation Bonds Series 2016; Rating: Aa3; Sale Amount: $26,280,000; Expected Sale Date: 03/31/2016; Rating Description: Lease Rental: Appropriation

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