The debt limit refers to the maximum amount of debt that a municipality or other applicable entity can incur. It is a critical financial constraint that ensures entities do not exceed prudent borrowing levels.
A Tax Anticipation Note (TAN) is a short-term debt instrument issued by state or municipal governments to finance immediate expenditures by borrowing against projected tax revenues. TANs help even out cash flow across fiscal periods and are repaid once the corresponding tax revenues are collected.
