General Obligation Bond (GO)

What is a ‘General Obligation Bond – GO’

A general obligation bond (GO) is a municipal bond backed by the credit and taxing power of the issuing jurisdiction rather than the revenue from a given project. General obligation bonds are issued with the belief that a municipality will be able to repay its debt obligation through taxation or revenue from projects. No assets are used as collateral.

Explaining ‘General Obligation Bond – GO’

A general obligation bond is secured by an issuing government’s pledge to use all available resources – even tax revenues – to repay holders of the bond.

Types of General Obligation Pledges

State law sets the grounds on which local governments can provide and issue general obligation bonds. A general obligation bond may either be a limited-tax general obligation pledge or an unlimited-tax general obligation pledge.

Further Reading

  • Comparative costs of negotiated versus competitive bond sales: new evidence from state general obligation bonds – [PDF]
  • Financing community facilities: a case study of the parks and recreational general obligation bond measure of San Jose, California – [PDF]
  • Municipal financial reporting and competition among underwriters for new issues of general obligation bonds – [PDF]
  • Management capacity and state municipal bond ratings: Evidence with the GPP grades – [PDF]
  • City size and geographic segmentation in the municipal bond market – [PDF]
  • Credit risk, credit ratings, and municipal bond yields: A panel study – [PDF]
  • Is management performance a factor in municipal bond credit ratings? The case of Texas school districts – [PDF]
  • Tax increment financing, economic development professionals and the financialization of urban politics – [PDF]
  • Determinants of Pay‐as‐You‐Go Financing of Capital Projects: Evidence from the States – [PDF]
  • Financing new school construction and modernization: Evidence from California – [PDF]