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Meramec Funding Sources

General Obligation Bond

General Obligation Bond

Aug. 1, 2019
By zz-api-account

Story summary:

  • General Obligation Bonds provide local governments the ability to borrow money to fund infrastructure projects, typically for a low-cost, tax-exempt rate of interest.

Quick Facts

Benefits of GO Bonds
Not limited in size of project

Not limited in scope of project

Tax-exempt

Low interest rate

Drawbacks of GO Bonds
Repayment required

May require increase of fees or rates to cover cost of repayment and interest

Voter approval required

About

General Obligations Bonds can be used to fund projects that will serve the community because the payoff is backed by the whole vested taxing authority of the municipality, no specific project identified as the source of funds to repay the bond obligation.

In Missouri, general obligation bonds cannot exceed 10% of the assessed valuation of the taxable tangible property in the municipality, and require voter approval by a two-thirds or four-sevenths majority, depending on when the elections are held.

General obligation bonds can help distribute infrastructure costs over the life of the asset. Flood risk reduction, and healthy watershed projects provide economic, environmental and quality of life protection for entire community and may provide a good source of project funds.

Consult your municipal attorney prior to moving forward with bond opportunities.

 

Project Examples

Lincoln, NE

In May of 2019, Lincoln, NE voters approved a $9.9M stormwater bond. Projects the bond covers include stream stabilization, storm sewer repairs and additions, and urban drainage projects. The majority of the bond, $6.6M, will help remove 480 homes and businesses from the Deadman’s Run floodplain. Projected flood insurance saves are $450-$2,400/property owner, and costs property owners $6 annually. More Info

 

Contact Info

 Consult your local municipal attorney prior to moving forward with bond opportunities.

Consult your community’s attorney and financial advisors prior to moving forward with any of these funding options. Any reference in this website to any person, or organization, or activities, products, or services related to such person or organization, or any linkages from this website to the website of another party, do not constitute or imply the endorsement, recommendation, or favoring of companies or organizations.
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