The NREDB Program is designed to stimulate economic development by funding key infrastructure projects, housing developments, and business initiatives across both rural and urban areas. The program uses asset-backed bonds to finance these projects and aims to generate returns from taxes, increased property values, and business activity.
- Issuance of Bonds:
- The U.S. Treasury issues long-term bonds (e.g., 20-year bonds) tied to specific housing and infrastructure projects in rural and urban areas.
- The bonds are sold to institutional investors (pension funds, mutual funds, etc.) and potentially to the general public.
- These bonds are asset-backed, meaning they are linked to tangible assets like real estate or infrastructure projects. As these assets generate revenue (through taxes, rents, or fees), they will help pay back the bondholders.