Dirt-Bond Holders in for Nasty Surprise

During the boom as housing developments grew through the country, developers worked with local governments to raise billions of dollars for roads, sewers, and sidewalks through municipal-debt security known as "dirty bonds". Observers estimate that about $35 billion dirt bonds were issured during the real estate boom but now some investors in dirt bonds have been hamstrung because of the unusual structure of the dirt-bond deals.

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