Gov. Nathan Deal announced recently that Georgia sold $685 million in general-obligation bonds to fund construction and to make repairs and renovations to existing facilities throughout the state.
“These bonds were sold at very low rates given current market conditions and that translates into savings for Georgians,” Deal said. “The state’s AAA bond ratings enable us to invest in vital infrastructure around the state in a fiscally responsible manner and provide for more employment opportunities for our construction industry, which was hit so hard by the recession.”
The Georgia State Financing and Investment Commission, which is responsible for issuing the state’s bonds, approved the bond sale at its most recent meeting. The bond issues were sold on a competitive basis, with investors showing solid demand for Georgia’s highest-rated bonds.
The state received competitive bids last week and secured rates of 3.33 percent for the 20-year tax-exempt bonds and 1.03 percent for the five-year tax-exempt bonds, with a blended rate of 3.20 percent. The state also sold $163.22 million of five-year and 20-year taxable bonds at a blended rate of 3.85 percent and $94.35 million of 20-year taxable Qualified School Construction Bonds at a rate of 4.02 percent. The federal government reimburses the state for the interest paid on the Qualified School Construction Bonds, which is a designation that was created in the American Recovery and Reinvestment Act applicable to state bonds that are issued for K-12 school-construction projects.
The largest amount of funding is to provide $249.355 million for Board of Regents projects at colleges and universities throughout the state. The second-largest amount is $209.505 million for the State Board of Education to provide funding to local school systems for K-12 school facilities. Other agencies that will benefit from the bond proceeds include $38.235 million for Technical College System of Georgia projects, $24.25 million for water and sewer loans to local governments and $26.5 million for Department of Natural Resources projects at state parks. Projects totaling $137.11 million have been designated for several other agencies.
Moody’s, Fitch and Standard & Poor’s rating agencies assigned their triple-A bond rating with a stable outlook to the state’s general-obligation bonds last week. The triple-A rating reflects the highest rating available.
“Once again, earning the top bond ratings during the current economic climate illustrates Georgia’s continued commitment to sound fiscal management while continuing to meet the needs of our citizens for increased educational and economic development opportunities throughout Georgia,” Deal said.