Why issue bonds?
There are 3 ways to finance the construction of major capital projects - use current revenues, capital reserve funds (setting aside money over time), and the issuance of bonds (borrowing money to be paid back in the future). Bond financing is often used for capital projects that are above and beyond the scope of the annual operating budget and are for facilities that will be used for many years in the future. Since most cities have few reserve funds set aside for major capital projects, it is necessary to issue bonds to build major projects. This process is similar to a family decision on how to purchase and finance a home or vehicle.

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1. What is a bond?
2. Why issue bonds?
3. How is the debt on bonds repaid?
4. Are there additional financial implications?
5. When are bond referendums held?
6. What is a bond rating?