BANs, TANs, and TRANs

Three types of short-term debt security issued by states, local governments, and other municipalities. They are issued in anticipation of being paid off by a coming source of revenue. BANs (bond anticipation notes) are issued on the expectation that a soon-to-be-issued long-term bond will bring about revenue. Thus, they bring in money for the short term. TANs (tax anticipation notes) bring in revenue that will be retired from taxes to be collected. TRANs (tax and revenue anticipation notes) are paid off from the revenue brought by taxes and other sources.