City Sells General Obligation Bonds for Transportation Improvements, Schools and Infrastructure Costs
- Alexandria issued $69.95 million in general obligation bonds at a low interest rate
- City’s top AAA/Aaa Bond ratings reaffirmed
On July 14, the City of Alexandria competitively bid and sold $69.95 million in AAA/Aaa-rated general obligation bonds at a favorable overall 3.18 % true interest cost over the 20-year life of these serial bonds, which is one of the very lowest rates ever achieved by the City. Last year’s historical low rate of 2.93% rate was achieved through a combination of short-term tax exempt bonds and a 35 federal Build America Bonds subsidy. That federal stimulus program subsidy is no longer available. There were 11 different bidding syndicates that bid on the City’s bonds, with Citigroup Global Markets, Inc. submitting the lowest interest rate bid.
The $69.95 million bonds will be used to finance certain capital improvement projects including transportation improvements, sanitary sewers, public school facilities and other infrastructure costs.
Alexandria Mayor William D. Euille said, "This positive news reflects the City’s strong economy, solid financial policies and decision making, as well as Alexandria’s proven financial reputation on Wall Street. Together, these bond ratings and favorable interest rate will save City taxpayers money and strengthen our future fiscal outlook."
Standard & Poor’s (S&P) and Moody’s Investors Service reaffirmed the City’s bond ratings of AAA and Aaa, respectively. In reaffirming the City’s AAA bond rating, S&P noted that the City’s rating reflects a “deep, diverse, and strongly performing local economy” and “strong financial management,” while stating that “the city's financial position in our opinion remains strong despite slower revenue growth.” Moody’s Investors Service agreed, declaring that the City’s financial strengths include a “conservatively managed budget with sound reserves.”