Bonds and Obligations

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The City issues debt in the form of bonds and obligations in order to finance long-term capital improvements such as streets, buildings, utility systems, etc. The financed assets should have at least the same useful life as the term of the bond (e.g., a water line with an expected useful life of 30 years should not be financed over more than a 30-year period).

Issuing bonds and obligations allows the City to meet infrastructure needs while paying for the assets as they are used. Because municipal debt interest payments are typically exempt from federal income tax, the debt requires a lower interest rate than other forms of borrowing.

For more information, visit the City of Mesa Data Portal on Bonds and Debt Service.

Type of Bond	Standard & Poor's	Moody's	Fitch
General Obligation Bonds	AA	Aa2	AAA
Utility Revenue Obligations	A+	Aa3	N/A

The City uses two main types of debt financing: (1) general obligation bonds and (2) utility systems revenue obligations. The ratings for these debt types are shown in the table above.

General Obligation (G.O.) Bonds are used to finance public safety, streets, parks and library projects. They are repaid primarily through secondary property tax and development impact fee revenue. G.O. bonds are backed by the full faith and credit of the City.

Utility Systems Revenue Obligations are used to finance natural gas, water, wastewater, electric, and solid waste projects. Utility revenue obligations are repaid from revenues received from the customers of each utility.

Purchasing City of Mesa Bonds/Obligations

The City of Mesa works with financial institutions to market and sell new City bonds/obligations to investors at the lowest possible cost. To purchase City bonds/obligations, contact a securities broker.

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