CONDUIT FINANCING – The issuance of municipal securities by a governmental unit (referred to as the “conduit issuer”) to finance a project to be used primarily by a third party, usually a for-profit entity engaged in private enterprise or a 501(c)(3) organization (referred to as the “conduit borrower”).  The security for this type of issue is customarily the credit of the conduit borrower or pledged revenues from the project financed, rather than the credit of the conduit issuer.  Such securities do not constitute general obligations of the conduit issuer because the conduit borrower is liable for generating the pledged revenues.  Industrial development bonds, multi-family housing revenue bonds and qualified 501(c)(3) bonds are common types of conduit financings.  See:  HOUSING REVENUE BOND – Multi-family housing revenue bonds; INDUSTRIAL DEVELOPMENT BOND; PRIVATE ACTIVITY BOND.