Bonds as a Source of Financing Development Projects of Local Self-government Units

The article is focussed on the role played by bonds in financing development projects of local self-government units. It shows that the local self-government faces a necessity of satisfying inhabitants’ needs in the field of providing services of a public character having limited financial possibilities. The standard and quality of provided services depend, among other things, on the state of technical and social infrastructure. Maintaining it at the same level and all the more so expanding the infrastructure, scope and quality of these services call for substantial financial outlays. The period of implementing them usually surpasses the budgetary year and, hence, the necessity of designing carefully plans and budgets of investments, as well as sources and assessing possibilities of financing them. It should be noted that the Public Finance Act permits local self-government entities - along with a budget for a given year - to enact long-term investment programmes, which should be compatible with the development strategy assumptions and constitute an element linking current management with strategic goals. A basic function of these programmes is to create favourable conditions for the local authority to plan and finance needs in the field of development in an orderly manner. Consequently, one of the most important issues is fixing priorities in development needs, as well as financial capabilities of the local self-management. Thus, it becomes indispensable to assess the size of long-term investment outlays, which can be afforded by a given local self-government entity