Pay-as-you-go capital financing means funding infrastructure projects from current revenues (typically property taxes or reserves) rather than borrowing. This approach avoids interest costs and debt but requires either higher current taxes, accumulated savings, or smaller project scopes. Pay-as-you-go may suit smaller projects or wealthy municipalities with substantial reserves. However, it can be inequitable for long-lived assets since current taxpayers pay entirely for infrastructure benefiting future residents. Most municipalities use combinations of debt financing and pay-as-you-go depending on project size, asset life, and fiscal circumstances. Intergenerational equity arguments support debt financing for infrastructure serving multiple generations.