Simply put it is an IOU. For example, a developer requests and may receive from the County (and in some cases the state) a financial loan of a predetermined amount to fund (in whole or part) the construction of the subdivision. The IOU “bond” must be repaid by the borrower, the developer. When the subdivision is completed the developer holds no rights and you, the total of individual homeowners at large, are then considered the self-sufficient owner of the subdivision.

Also: Government entities like towns, counties, states, and the federal government, obviously can’t sell you/the developer stocks, because they can’t “own” the government. So, they have two ways to generate revenue with which to accomplish things. They can levy taxes, or they can “float” a bond. (Float just means “offer for sale”) It’s called “float” because if you offer it and no one buys it, it “sinks.”