APPROPRIATION BONDS

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March 18, 2019


 

Request: Whether the debt limitations in Section 13 of Article X of the State Constitution apply to the issuance of appropriation bonds?

Conclusion: An appropriation bond does not, by its very  nature, run afoul of the constitutional debt limit. The ability to repeal or modify is crucial to the analysis of whether a financing mechanism violates the constitutional debt limit. Bonds payable from appropriations made by the Legislative Assembly must be subject to modification or repeal by future legislative assemblies in order to be upheld against a constitutional debt limit challenge.

Opinion 2019-L-02

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