§ 54418 Bond Sale Procedures

• •The government can sell bonds (like IOUs) for money, either at a higher or lower price than their face value.
• •They can sell these bonds in public (like an auction) or private (direct deal) sales.
• •If they choose a private sale, they must tell the California Debt Advisory Commission why within two weeks.

A city needs money to build a new park. Instead of raising taxes, they decide to sell bonds to investors.

The city can sell these bonds at a discount (for less than $100 each) or at a premium (for more than $100 each). If they sell them directly to a big investor instead of holding a public auction, they have to send a note to the state explaining why they did it that way.