The Municipal Bond Market Post Tax Cuts and Jobs Act

The Municipal Bond Market Post Tax Cuts and Jobs Act

Many municipalities had utilized tax-exempt advanced refundings for debt service savings through interest cost reductions and debt restructuring. The loss of this valuable tool is a blow to the many agencies who acted as good stewards of their limited repayment resources. The beneficiaries of these savings ranged from taxpayers to operating budgets to obligors of the debt. While districts may still advance refund bonds, they now have to do so with taxable bonds, and taxable bonds are more expensive than tax-exempt bonds.

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What Is the Difference Between a Proposition 39 and Proposition 46 General Obligation Bond Election?

What Is the Difference Between a Proposition 39 and Proposition 46 General Obligation Bond Election?

California K-14 districts can elect to have their bonds approved under proposition 39 or Proposition 46. Selecting Proposition 39 or Proposition 46 for a bond election could be a political, facility-related, financial, or timing decision, among others.

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What Is a Current Interest Bond?

What Is a Current Interest Bond?

While there are many types of municipal bonds such as GO bonds and revenue bonds, these bonds are generally issued as either current interest bonds or capital appreciation bonds. A common misconception is that current interest bonds pay both regular interest and regular principal. This is not true. Multiple current interest bond maturities though could be structured such that principal is amortized more regularly.

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