Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
St. Mary's County sells $30 million in bonds at 1.62% interest; commissioners authorize administrator to accept award
Summary
St. Mary's County sold $30 million in general-obligation bonds at a 1.62% all-in true interest cost, received roughly $4 million in premium to apply to projects, and the commissioners voted to authorize the county administrator to accept the bid as certified by the chief financial officer.
St. Mary's County commissioners on May 11 approved a motion authorizing the county administrator to accept the certified award for a $30 million bond sale, concluding a transaction that produced an all-in true interest cost of 1.62 percent and a premium of roughly $4 million.
The county received bids from 10 underwriters, with visible rates ranging from 1.58% to 1.68% before the final sizing and inclusion of underwriting fees. Chief Financial Officer Jeanette Cudmore told the panel the premium will allow the county to apply roughly $4 million to additional projects while keeping the principal repayment at $30 million.
"We think you entered at a wonderful time and obviously, the proof is in the pudding, you know, in the interest rate that you've got," bond advisor Pam Kelly said, congratulating the county on the timing and market reception. Bond counsel Cheryl Guth echoed that praise: "I wanna congratulate the commissioners and Jeanette and her staff for such a great result."
Cudmore reported that the debt service pattern for the transaction would be for a 20-year term (not 30 years) and said the average annual principal-and-interest payment will be about $2,005,000. Commissioners voted by voice to authorize the county administrator to accept the certified award; the motion carried after the chair called for the ayes and no opposed were recorded.
The county's sale drew attention because it was the only Maryland municipal transaction offered to the market the week the sale was conducted, according to Kelly. County staff said the premium provides flexibility to accelerate or add projects without increasing the principal being repaid.
Next steps noted at the meeting included receipt of the good-faith deposit from the purchaser and final closing mechanics with the county's bond counsel and financial advisor.
