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 endorses bills on a case-by-case basis but is supportive of efforts to restore tax-exempt advance refunding bonds. For further inquiries, email

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

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