[FISCAL NOTES] Certificates of Obligation: A Controversial Funding Tool for Local Projects
Texas Comptroller of Public Accounts sent this bulletin at 01/18/2017 11:37 AM CST
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| Learn More About Certificates of Obligation | |
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Most debt issued by Texas local governments must go before voters for approval. A prominent exception to this rule, however, is the "certificate of obligation," issued for terms of up to 40 years and usually supported by local revenues. Since they can be issued without a bond election, certificates of obligation provide speed and flexibility when local governments need to act quickly. The way in which they circumvent voter approval, however, has made these instruments controversial, spurring the 2015 session of the Texas Legislature to limit their use. The December-January issue of Fiscal Notes examines this funding mechanism in detail.
We also report on fiscal notes — documents prepared by the state's Legislative Budget Board, often with assistance from the Comptroller — that estimate the financial impact of new legislation. Fiscal notes, which gave this publication its name, ensure legislators and the public at large fully understand the impact of proposed laws. |
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