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Office of Management & BudgetPO Box 1466 Contact Information480-644-5799
Government
The City uses two main types of debt financing: (1) general obligation bonds and (2) utility systems revenue obligations. The ratings for these debt types are shown in the table above. General Obligation (G.O.) Bonds are used to finance public safety, street, park, library, and storm sewer projects. They are repaid primarily through secondary property tax and development impact fees. G.O. bonds are backed by the full faith and credit of the City. Utility Systems Revenue Obligations are used to finance gas, water, wastewater, electric, and solid waste projects. Utility revenue obligations are repaid from revenues received from the customers of each utility.
Purchasing City of Mesa Bonds City bonds are not sold directly to the public. Rather, the City sells bonds to financial institutions in bulk to achieve the lowest possible cost. Residents wishing to purchase City of Mesa bonds should contact a securities broker to purchase the bonds in the secondary market. State Bond ProcessPaying for large capital improvements over time is possible through General Obligation (GO) Bonds. This long-term financing promotes jobs, education, infrastructure, economic development, energy efficiency, water quality, open
space, and other public purposes. It achieves public goals approved by the Legislature and Maine voters. The process spreads financial responsibility for long-term investments over the time and population that can expect to enjoy the benefits. Following are steps taken in the General Obligation Bond Process.
Here are some additional facts about Maine General Obligation Bonds:
*Constitutional provisions are from Art V, Pt 3, Sec 5 and Art IX, Sec 14. **Required by bond covenants. Which of the following would be financed by a general obligation bond issue?Examples of the types of projects funded by general obligation bonds are the construction of public schools and highway systems. They are called “general obligation” bonds because they are not backed by a specific revenue producing project or asset. Instead, they are backed by the “full faith and credit” of the issuer.
What can general obligation bonds be used for?General obligation bonds also serve as a way for local governments to raise funds for projects that create streams of income for things such as roads, parks, equipment, and bridges. General obligation bonds are usually used to fund government projects that will serve the public community.
Which of the following is a type of general obligation bond?There are two types of general obligation bonds: the limited-tax GO bond and the unlimited-tax GO bond.
How are general obligation bonds funded?These bonds are backed by the general revenues of an issuer, including taxes. Unlike dedicated tax GOs, however, they do not have a specific tax pledged to repay them. Instead, bondholders are paid from general revenues, and if those prove insufficient to cover debt service, the issuer typically must raise taxes.
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