Expert explains the use of green bonds

Professor of the Public Administration Experienced Beverly Bunch led an academic conference Oct. 27, examining the role of green bonds in local and state government.

The speech, entitled “Going Green: An Analysis on the use of Green Bonds by State and Local Governments,” gave an in-depth look into why a government would take out a green bond and its potential benefits.

“We have to believe that green bonds are worthwhile,” said Bunch.

A green bond is just like any other type of government bond, except the proceeds must be invested in projects that work for a sustainable future. Experts hope that the green bond market will explode in the coming years, given the bond’s high credit quality and unique tax advantages. 

“Investors are willing to spend in the market because they value the environment, but it takes time,” said Bunch.

She noted that the biggest problem with green bonds is that many investors simply don’t know that it’s an option.

“It is necessary to communicate with the citizens well,” said Bunch “It is actually a PR issue here; it would benefit governments if they could share more information with investors.”

She also noted that green bonds still need to be developed and researched, as more evidence is needed to prove interest rate savings.

Bunch has previously worked at The Government Finance Officers Association, the City of San Antonio budget office, and the Texas Bond Review Board. She is passionate about intergovernmental fiscal relations, capital financing, and state and local government budgeting.

“I like people to be aware of what government is doing and what they are using taxes for,” she said.  “And it is necessary to let residents understand the terms of environmental sustainability.”