Private activity bonds (PABs) are issued by state or local governments to finance privately owned projects that serve a public purpose, such as hospitals, airports, or affordable housing. While PABs share similarities with municipal bonds, they involve more risk because private enterprises are responsible for repayment. Investors in these bonds may receive tax advantages if the projects benefit the public, but they also face risks related to construction delays, revenue generation, and regulatory changes. PABs appeal to both developers and investors for their potential cost-saving and tax benefits.
Merging Private Capital with Public Projects
