About Virginia General Obligation Bonds
General Obligation Bonds of the Commonwealth are secured by a pledge of the full faith and credit. The Virginia Constitution sets out the requirements for Commonwealth debt in Article X, Section 9. General Obligation Bonds of the Commonwealth are currently rated in the highest bond ratings category - AAA, Aaa and AAA by Fitch, Moody's and Standard and Poor's, respectively.
Section 9(b) of Article X of the Constitution permits the issuance of general obligation debt for capital projects upon authorization by the General Assembly, and upon approval by a majority of the voters at referendum. The last referendum was held in 2002, when general obligation bonds were authorized for up to $900.5 million for capital projects at educational facilities of the Commonwealth. In the same year, up to $119.0 million was authorized for state park and recreational facilities. These bonds have all been issued.
Section 9(c) of Article X of the Constitution permits the issuance of general obligation bonds without voter approval for specific revenue-producing capital projects secured by net revenues derived from rates, fees and charges of the project, and the full faith and credit of the Commonwealth. The debt must be authorized by the affirmative vote of two-thirds of the members elected to each house of the General Assembly. 9 (c) Bonds are frequently authorized and issued for revenue producing projects such as higher education dormitories and dining facilities.