Escrowed to maturity bonds are refunded municipal bonds that are repaid ahead of time with funds drawn from an escrow account. Often, the escrow account holds low-risk government securities to hedge against potential inflationary risks.
For example, suppose that a municipality wants to deleverage its balance sheet in order to qualify for a federal subsidy. By setting up an escrow account with U.S. Treasuries, the government can refund the bond issues and reduce its debt to equity ratio.