Municipal Notes – What They Are and How They Work

municipal notesMunicipal notes are short term debt issued by municipalities, normally to cover spending until money is received from a specified source.

There are 3 primary types of municipal notes:

  1. Tax anticipation notes (TAN) – Short term debt issued to cover spending until tax revenue comes in.
  2. Revenue anticipation notes (RAN) – Short term debt issued to cover spending until revenue comes in from one of the municipalities projects such as a sewage or electric plant.
  3. Bond anticipation notes (BAN) – Short term debt issued to cover spending until a bond issue is completed.

For the definition and explanation of more bond related words visit the Learn Bonds glossary where we give the meaning of many additional terms.

Learn More

Municipal Bond Defaults, Safety, and Credit Ratings
Municipal Bond Yields
How to choose a municipal bond fund
How to buy municipal bonds

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