The Government Financial Officers Association (GFOA) recently posted a succinct advisory about the dangers of issuing a taxable bond to reduce unfunded public pension liabilities (a “Pension Obligation Bond” or POB).

Infrastructure recapitalizations have been successfully used to pay down pension obligations in the past — and will be increasingly used for this purpose as the public sector’s need increases and more efficient options for the recap structure expand.  I thought a quick “compare and contrast” with the GFOA advisory point would be interesting (click to enlarge):