There are three main classes of long-term munis:

  1. General obligation (GO) bonds are secured by the full faith, credit and taxing power of the issuer.

  2. Revenue bonds are secured by the full pledge of specific revenues, such as revenue from water bills, airport gate charges or turnpike tolls.

  3. Industrial development revenue bonds (IDRBs) are issued through a local governmental agency on behalf of a private business, and proceeds are intended to build or acquire factories or factory tools, which have the effect of improving the employment prospects in the local area. The debt service on the bonds is paid solely by the company.

GO and revenue bonds are used much more often than the highly specialized IDRBs. All levels of municipal government use revenue bonds, but only states, counties, cities and school districts put their full faith and credit behind GOs.

Issuer Types of Debt Generally Issued
State governments GO and revenue
Cities GO and revenue
Counties GO and revenue
Public school districts GO and revenue
Colleges and universities GO and revenue
Public power authorities Revenue
Water/sewer authorities Revenue
Transit authorities Revenue
Health facilities Revenue
Student loan agencies Revenue
Housing authorities Revenue
Waste disposal districts Revenue
Source: Federal Reserve Bank of Richmond (Va.).


Short Term Munis

Related Articles
  1. Managing Wealth

    Revenue Analyst: Job Description & Average Salary

    Learn what a revenue analyst does and what skills are needed to succeed in the position. Determine the education and experience required to work in this field.
  2. Personal Finance

    Municipal Bond Tips For The Series 7 Exam

    Learn to distinguish between general obligation and revenue bonds to ace this test.
  3. Managing Wealth

    Revenue Analyst: Career Path & Qualifications

    Learn more about the duties of a revenue analyst and the qualifications needed for the position, along with the career path for these professionals.
  4. Investing

    S&P 500 Index: A Revenue Case Study

    Discover the breakdown of aggregate total revenue of S&P 500 companies, including how much revenue is earned by country, industry and geographic location.
  5. Markets

    S&P 1500 Index: A Revenue Case Study

    Learn what comprises the S&P 1500 and how analysts use revenue trends to benchmark against the performance of a portfolio or single stock investment.
  6. Investing

    What does Deferred Revenue Mean?

    Deferred revenue is advanced payments received by a company for products or services that it has not yet rendered or shipped. Another term for deferred revenue is unearned revenue. Whereas normal ...
  7. Markets

    Global Financials: Exploring Revenue Trends & Fundamentals

    Learn where the global financial industry stands on revenue fundamentals compared to other industries and explore industry trends by geography.
  8. Entrepreneurship & Small Business

    How Do Companies Calculate Revenue?

    Revenue is the money a company receives in exchange for its goods and services.
  9. Managing Wealth

    World's Top 10 Trading Companies

    Which are the top trading firms of the world? Here is the list of the ones with highest trading revenue.
  10. Markets

    Understanding Cost of Revenue

    The cost of revenue is the total costs a business incurs to manufacture and deliver a product or service.
Trading Center