LEONARDTOWN, Md. (Nov. 18, 2009)—St. Mary's County Government sold bonds on Nov. 17 at an all-time low net interest rate of 3.09%. The Board of County Commissioners for St. Mary's County was advised that the most recently published rates for sales by AA rated municipalities, just the previous day, posted 3.30%, and that the County's rate approximated that of AAA rated municipalities, which posted 3.08%.
The County sold $30 million in bonds to fund capital projects approved through the FY2009 budget year. $19.7 million was for school projects and the balance included funds for the College of Southern Maryland Wellness Center in Leonardtown, Patuxent Park Neighborhood Revitalization as well as several other road and park projects. Commissioner President Russell pointed out that "though these are challenging economic times, we believe that it is important to invest in the needs of the community."
In addition to the new money issue, the County refunded $15.6 million of bonds originally issued in 2001, yielding debt service savings over the remaining original term of those bonds of just over $700,000.
Last week the County received its ratings reports from Standard & Poors, Fitch Ratings, and Moody's of AA, AA, and AA3, respectively. The ratings reports, used by investors in their determination of bids, indicated that the high quality ratings and stable outlook were based on stable economic attributes accompanied by diversification efforts, management practices that are strong and well embedded, reserve levels that are sound, and moderately low debt levels based on adherence to debt affordability policies, with a demonstrated ability to reduce capital spending in response to economic dictates.
In describing the rating process and results, Commissioner President Francis Jack Russell stated "We believe that we are handling the County's finances and the community's needs in a responsible and balanced manner. Participating in this process gave me a good indication of how those in the financial community evaluate us, and I am proud that they view our fiscal policies as strong. But at the end of the day, all of this was reinforced by the interest rate. At 3.09% - investors awarded us the same financial advantage as a AAA rated organization, saving St. Mary's County millions of dollars over the life of these bonds."
Source: St. Mary's County Government