What are tax anticipation notes typically issued against?

Tax anticipation notes (TANs) are short-term debt instruments issued by municipalities in anticipation of receiving tax revenues that will be collected in the future. These notes provide municipalities with immediate cash flow to meet current expenses while they wait for tax payments to come in, typically during a period when expenses exceed current revenues.

When municipalities anticipate receiving tax revenues, they issue TANs to take advantage of those expected revenues without having to wait for the actual collection. This can be particularly useful in managing cash flow during periods where expenses are incurred before tax revenues are received, such as at the beginning of the fiscal year.

Expected property taxes can be a component of the overall tax revenues anticipated, but TANs are specifically tied to the broader category of expected tax revenues, which may include various forms of taxes beyond just property taxes. Grants and investments, on the other hand, do not directly correlate with the issuance of tax anticipation notes, as TANs are specifically focused on tax income.