City Nets $16 Million Savings in Bond Market
Mayor Levar M. Stoney today announced Richmond has taken advantage of historic low interest rates and the city’s strong credit ratings to refund $142 million in existing debt service tied to four outstanding bond issues, which will result in the city reducing its existing debt service by approximately $16 million over the next 15 years.
This incredible savings was achieved as part of the successful sale of $229 million in tax-exempt and taxable General Obligation Public Improvement and Refunding Bonds, of which $87 million was for new money projects with a cost of approximately 2.77%, near the lowest cost of funds in several decades.
The bonds were highly rated by all three national credit rating agencies - Moody’s, Standard & Poor’s and Fitch (Aa2, AA+, AA+ respectively). Wells Fargo was the winning bidder for the tax-exempt bonds and Raymond James was the winning bidder for the taxable bonds.
“This is how we do more,” said Mayor Stoney. “It is part of a concerted and multifaceted strategy to find and free up more dollars for our critical needs, such as our school and public safety priorities.”
Davenport & Company LLC, the city’s financial advisors, cited the recent and highly-rated credit assessments affirmed by all three national credit rating agencies for these excellent results. “This underscores Wall Street’s confidence in the city and its financial future,” added Chief Administrative Officer Selena Cuffee-Glenn.