Pronounced “slugs,” it is an acronym for “State and Local Government Series.”  SLGS are special United States Treasury Securities sold to Issuers and Conduit Borrowers directly by subscription from the Department of the Treasury.  There are two types of SLGS: demand deposit (i.e., money market, short-term Securities) and time deposit (i.e., Fixed Rate Securities of varying maturities), the latter of which are more frequently used.  SLGS are designed to help Issuers and Conduit Borrowers comply with Arbitrage restrictions imposed by the Code on Tax-Exempt Bonds and are frequently used to restrict the Yield on investments or to fund an Escrow in connection with a Refunding or a Defeasance.

See Also


A transaction in which refunding bonds are issued and their proceeds are used to pay off outstanding bonds.

Escrow Fund

Trust account established in the escrow deposit agreement that holds cash, investments, usually obligations of the federal government or, sometimes, federal agencies, or both, all of which are pledged to the payment of the debt service of the refunded bonds.


Termination of the rights and interests of the bondholders and release of liens on the security upon final payment of debt service or deposit of guaranteed payment in an irrevocable escrow fund.


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  • News

Extraordinary Measures Start: No SLGS Suspension

Treasury Secretary Yellen announced the U.S. had reached its statutory debt limit and would implement extraordinary measures. Notably absent— any mention of SLGS suspension.

  • Comments

On the Suspension of SLGS Sales (2014)

Comments with suggestions for changes to the extraordinary measures taken by the Bureau of Fiscal Service (“BFS”) when the U.S. Department of Treasury determines that debt of the United States…

  • Comments

Suspension of Issuance of SLGS

Suggestions for changes to the extraordinary measures taken by the Department of Treasury as the United States approaches its debt limit.

  • Comments

Response to Proposed Rulemaking on SLGSs (2004)

Response to the Bureau of Public Debt’s (BPD’s) notice of proposed rulemaking pertaining to the sale of State and Local Government Series (SLGS) Securities.

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A meeting of all the parties prior to the closing, often held the day before the closing.