What are bonds?
A bond is basically a loan or an IOU. Instead of obtaining a loan from a bank, a corporation or government can issue bonds. The bond itself represents a promise to pay (1) a sum of money at a designated maturity date plus (2) interest at a specified rate based on the face value of the bonds. The city’s bonds have a face value of $5,000 each and pay interest annually at rates of 3.25% to 5%. The bonds mature at various times between 2017 and 2038. The buyer of the bonds receives interest on an annual basis and then receives the face value ($5,000 for Miramar) when the bond matures. The Series 2013 bonds are tax exempt which means the buyer generally does not have to pay taxes on the interest earned on the bonds.

Show All Answers

1. How will the city pay for all of these projects?
2. What are bonds?
3. How will the bond proceeds be spent?
4. Why didn’t the city just borrow from a bank?
5. Why did the city pay off the Vizcaya loan with bond money?
6. How will the bonds be paid?
7. Will my taxes increase in order to pay for the debt service on the bonds?
8. Why didn’t the city wait until they had the money available to pay for these projects instead of issuing debt?