3.1 Introduction: What Constitutes A “Type” Of Debt Obligation

3.1 Introduction: What Constitutes A “Type” Of Debt Obligation

The types of debt obligation discussed in this chapter take their form and substance from several core features: the security and source of payment, the interest and payment characteristics, and the tax treatment. Debt obligations can exhibit multiple features. A sales tax revenue bond, for example, may also be a tax-exempt, long-term, fixed-rate bond. In addition, some unique California debt obligations have been structured specifically to address restrictions imposed by California statutes. 

The descriptions in this chapter include appropriate cross-references to Chapter 1, Legally Incurring Debt – State Law Restrictions on Public Agency Debt and Revenues, Chapter 2, Debt Structures: What Factors Drive Structuring Decisions?, and Chapter 4, Federal And State Tax Law Requirements.