State of Washington Successfully Prices Largest Refunding in State History, Savings Top $154 million
Contact: Chris McGann 360-902-9033
OLYMPIA - Today' $978 million bond sales marked the state's largest refunding in history and the largest competitive municipal-debt sale nationwide since before the financial crisis. Savings exceeded $154 million in today’s dollars in savings, a major milestone for Washington taxpayers.
Since Treasurer McIntire took office in 2009, Washington has achieved record savings, reducing debt service costs by $1.1 billion on a present value basis. Focusing on the current budget cycle, nominal savings from today's refundings are in excess of $15 million which will help balance the budget and preserve essential services for taxpayers.
"Washington has successfully executed the country's largest tax-exempt competitive bond sale since the economic collapse in September 2008," said State Treasurer James McIntire. "Our state continues to maintain the fiscal discipline necessary to access to the bond markets so that we can reduce the interest rates we’re paying on old debt. Refinancing our bonds in today's low interest environment produced present value savings of more than 14 percent."
McIntire said the savings is a reminder that strong financial management has a real dollar value to taxpayers.
"This bond sale will lower General Fund debt service costs by more than $11 million this biennium to help close the budget gap," McIntire said. "Combined with earlier refinancings and our ability to sell bonds at lower than expected interest rates, this brings our total general fund savings in this biennium's debt service costs to $31 million since the budget was adopted last spring."
Bank of America Merrill Lynch beat out eight other bidders in the $715.2 million various purpose general obligation refunding with a True Interest Cost (TIC) of 2.62 percent. Wells Fargo Bank was the highest of eight bidders on the $263.4 million motor vehicle fuel tax refunding with a TIC of 2.57 percent.
For more information visit the Office of the State Treasurer’s website at www.tre.wa.gov