What are the two types of bond ordinances?

Bond ordinances are essential tools used by municipalities to finance various projects and improvements. There are two primary categories of bond ordinances: regular and local improvement.

Regular bond ordinances are typically used for general purposes, such as funding essential services or standard municipal projects. These bonds provide the means to raise capital that municipalities need for broader improvements that benefit the community as a whole.

Local improvement bonds, on the other hand, are designed specifically for projects that provide direct benefits to specific properties or districts within the municipality. These might include infrastructure projects like road paving or sewer installations that enhance the value of nearby properties. The costs associated with local improvements are usually assessed to the property owners who benefit directly from the improvements, reflecting a more targeted financing approach.

This differentiation is important as it helps to establish the financial responsibilities of both the municipality and the property owners, ensuring that financing mechanisms are aligned with the expected benefits of the projects being funded. Understanding these classifications enhances the clarity regarding how municipalities manage their finances and the implications for residents.