Who may issue TRANs for cash flow purposes?

The issuance of Tax and Revenue Anticipation Notes (TRANs) is typically the responsibility of local governments. TRANs are short-term debt instruments used by municipalities to manage their cash flow needs, particularly when revenues are not yet received but expenses need to be covered. Local governments use TRANs to ensure they have the necessary funds to meet their short-term obligations, such as payroll and operational costs, until tax receipts or other revenues come in.

This mechanism is particularly useful for localities that experience seasonal fluctuations in cash flow, common in areas that rely heavily on property taxes or other cyclical revenue sources. By issuing TRANs, local governments can maintain liquidity and ensure uninterrupted services to residents, which is a core responsibility of municipal finance management.

While other entities like state governments, federal agencies, and private investors play significant roles in the broader finance ecosystem, they are not primarily involved in the issuance of TRANs for cash flow purposes in the same way that local governments are. The purpose of TRANs aligns specifically with the fiscal needs and obligations of local governments, making their role critical in this context.