Glossary of Municipal Securities Terms


An organization recognized by the Internal Revenue Service as a not-for-profit organization operated for charitable or other exempt purposes and not for private interests. Subject to certain IRS rules and regulations, a 501(c)(3) organization can borrow funds to finance projects on a tax-exempt basis through a governmental unit (referred to as a conduit issuer). Examples include not-for-profit colleges and universities, hospitals, museums and retirement communities. See: CONDUIT BORROWER; CONDUIT FINANCING; PRIVATE ACTIVITY BOND – Qualified 501(c)(3) bonds.

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