In a normal public finance transaction to raise capital, local governments often have to pledge some form of revenue stream that’s both reliable and enough to meet the debt service for the capital raised.
For most municipal debt issuances, these revenue streams are often limited to sales tax, property tax, some form of utility user tax, or a combination of all three. However, with the constantly evolving capital markets and its investor base, issuers are demanding more creative ways to pledge alternative revenue sources to take the pressure off their other revenue streams.
In this article, we will take a closer look at the world of Low Carbon Fuel Standard Credits (LCFS) and how some transportation agencies are pledging them as a revenue source to issue green debt for their respective capital needs.
municipalbonds.com
by Jayden Sangha
Sep 01, 2021