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Hiding Out In Prison Bonds---How Lease Revenue Bonds Work

By Real Cost of Prisons Project (The Sentencing Project)

For more information on this, you can go to: http://www.realcostofprisons.org/materials/comics/prisontown_flowchart.pdf Hiding Out In Prison Bonds Adviser Soapbox Alex Anderson, Forbes Tax Advantaged Investor 10.22.08 Prison bonds are a subset of a fixed income security class called lease revenue bonds (LRBs). Lease revenue bonds used to finance prisons have a few characteristics that make them attractive to investors--not the least of which is their relative safety compared to their yield. Further, they are exempt from state taxation for residents of the state of issue. If you're looking for enhanced yield without imprudently ratcheting up your risk, read on. Shoving aside the legal fiction created by these transactions, a lease revenue bond is actually a loan made to the state by the bond holders that is repaid by income (revenue) generated by the project...continue to full post

Full post as published by The Real Cost of Prisons Weblog on October 23, 2008 (boomark / email).