§ 26263 Bond Interest Prepayment Authority

• •The government can borrow money by selling bonds to pay for big projects like building schools or roads.
• •Instead of paying the interest on these bonds right away, they can include the interest cost in the total amount they borrow.
• •The interest can be covered for up to 5 years while the project is being built or completed.

A city wants to build a new park but doesn't have enough money right now.

The city can borrow money by selling bonds and include the interest costs for the next 5 years in the total amount they borrow. This way, they don't have to worry about paying interest separately while the park is being built.