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Council awards $12.97 million general obligation bond sale; city rating reaffirmed
Summary
Johnston’s council approved Resolution No. 25-147 to direct the sale of up to $12,970,000 in general obligation bonds (adjusted), accepting a low bid from TD Securities. Staff said S&P reaffirmed the city’s AA+ rating and the lower-than-expected interest rate will reduce long-term interest costs.
The Johnston City Council approved a resolution directing the sale of general obligation bonds and accepted a low bid that staff said will lower projected interest costs for the city.
City financial advisers reported favorable bidding on the city’s planned $12,970,000 general obligation bond issue. The municipal advisor said the low bid came from TD Securities at an average interest rate reported as 4.067%, with other competitive bids close behind. As part of the sale process the city obtained a ratings review from S&P Global; staff said S&P reaffirmed the city’s AA+ rating.
The municipal adviser told the council that the realized interest rate is about 1.08 percentage points lower than the rate the city had assumed in its plan of finance, reducing projected interest costs by roughly $1.4 million over the life of the bonds. Staff also explained that the bond structure produced premium proceeds; staff and advisers recommended borrowing a slightly lower par amount this year rather than keeping the premium proceeds and borrowing a larger amount at higher long-term cost.
PFM (municipal adviser) recommended awarding the bonds to TD Securities of New York. Council approved Resolution No. 25-147 to direct the sale and accept the recommended award.
Staff said proceeds will fund the FY26 capital improvement program identified in the city’s plan of finance. Council approved the resolution by roll-call vote.
