For decades, state and local governments were able to refinance outstanding debt by issuing a tax-exempt advance refunding bond to pay off another previously issued bond. Typically, the new refunding would allow the issuer to achieve a lower interest rate and generate savings to the issuer and taxpayer.

Why We Care

Between 2007 and 2017, issuers used advance refundings to save more than $18 billion.[1] While issuers can still use current refunding bonds within 90 days of the call date, permitting issuers to once again issue tax-exempt advance refunding bonds beyond that window would allow state and local governments to take advantage of favorable interest rate environments, save tax dollars, and reinvest savings in additional infrastructure.

NABL Stance

NABL currently supports the Investing in Our Communities Act (H.R. 1837) and the LOCAL Infrastructure Act (S. 1453), which would restore tax-exempt advance refunding bonds. To learn more about our advocacy on this issue or to learn more about how your office can cosponsor legislation to restore advance refundings, please email

[1] GFOA. “Advance Refunding Myth Buster.” Web access:

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Representative Terri Sewell (D-AL) shows NABL 2023 President her phone in the U.S. Capitol Building.

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