What defines Double-Barreled Debt?

Double-barreled debt is characterized by its backing from two distinct sources of repayment: both revenue and tax sources. This dual backing provides a layer of security for the bondholders, as it mitigates risks associated with reliance on a single source of income for debt repayment. In essence, if the primary revenue source (like fees generated from a specific project) underperforms, the debt can still be serviced through the secondary source, which is typically tax revenues.

This structure is particularly attractive to issuers because it can lead to higher credit ratings and potentially lower interest rates. By having both revenue and tax support, municipalities can appeal to a broader range of investors, increasing marketability and liquidity.

The other options do not accurately represent the nature of double-barreled debt. For example, securing bonds solely by property taxes or issuing them to fund non-revenue generating projects does not involve the dual backing characteristic of double-barreled debt. Also, while some municipal bonds may require state approval, this is not a defining feature of double-barreled debt itself.