Washington State's Bond Sales Indicate Improving Economy
Contact: Scott Merriman, 360-902-9018
January 22, 2014 - Washington successfully sold $705.7 million in bonds today at the tightest spreads since the onset of the credit crisis in 2008. Proceeds will be used for highway construction and capital projects throughout the state.
State Treasurer James McIntire said that today’s sale demonstrates the strength of investor demand for the state’s paper noting in particular that borrowing costs on the taxable portion were very close to those of another Washington borrower, Microsoft.
“We’re extremely happy with today’s bids,” McIntire said. “These results recognize the continued improvements to our economy as well as the state’s strong financial practices, solid liquidity, and commitment to sound debt management.”
All three rating agencies reaffirmed the state’s strong credit ratings with a stable outlook.
The $348.3 million Series 2014D Bonds were issued for capital projects such as K-12 school construction and energy efficiency upgrades, community college construction, water supply developments in the Yakima River Basin and Columbia River Basin, fish hatchery improvements, and Hood Canal aquatic rehabilitation.
The $88.1 million Series 2014T-2 Bonds will pay for improvements to local infrastructure, community revitalization, low-income housing, and various energy efficiency and renewable energy projects that cannot be financed with tax-exempt bonds under federal tax code.
Proceeds from the $269.3 million Series 2014E Motor Vehicle Fuel Tax GO Bonds will finance transportation projects around the state including replacement of both the SR 99 Alaskan Way Viaduct and SR 520 bridge, high occupancy vehicle lanes in Pierce County, and maintenance for I-90 at Snoqualmie Pass East, the SR 522/Snohomish River Bridge and I-5 in Cowlitz and Lewis Counties.
J.P. Morgan Securities was the lowest of six bidders for the Series 2014D, Various Purpose General Obligation Bonds, at a true interest cost (TIC) of 4.04 percent. Morgan Stanley was the lowest of six bidders for the Series 2014E, Motor Vehicle Fuel Tax General Obligation Bonds at a TIC of 3.85 percent. Wells Fargo Bank was the lowest of 11 bidders for the Series 2014T-2, General Obligation Bonds, at a TIC of 2.06 percent.