The Idaho School Bond Guaranty Act was created for the purpose of establishing a default avoidance program for voter-approved school bonds issued by Idaho public school districts.

In 2009 the Idaho legislature modified the program to allow two tiers of enhancement which include (1) enhancement by the State, and (2) enhancement by the State and Endowment Fund Investment Board (EFIB). Each option provides a different credit enhanced rating to the issuer of the bonds. The State enhancement may enable school district's to receive a Aa1 Moody's rating and/or AA S&P rating, while the additional enhancement by the EFIB may enable school district's to receive a Aaa Moody's rating and/or AAA S&P rating. The enhancement provided by the EFIB has been capped at $40 million per district.