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St. Paul approves sale of 2025 general obligation bonds after competitive bids; city keeps strong credit ratings
Summary
The council approved resolutions accepting competitive bids for the 2025A general obligation various purpose bonds and the 2025B street reconstruction bonds. Staff reported winning bids and interest costs below or near last year’s levels and noted S&P and Fitch assigned a AAA stable outlook.
The St. Paul City Council approved resolutions authorizing the sale and issuance of general obligation bonds for 2025 on a series of motions the council adopted unanimously.
Veil Youngens, debt investment manager in the Office of Financial Services, told the council the city received multiple competitive bids for two bond sales. "We received 11 bids, with UMB Bank receiving the winning bid with the lowest true interest rate cost of 3.27% for a 10 year term," Youngens said. For the street reconstruction bonds (2025B), the winning bid came from Robert W. Baird with a true interest rate cost of 3.92% for a 20-year term, Youngens said.
Youngens noted both sales occurred in a strong market for the city: earlier in May the city was assigned a AAA stable outlook by S&P and Fitch. He credited strong financial management, detailed long-term capital planning and robust reserves for the favorable ratings and competitive interest rates. "They cited us for exceptional management, with a history of well managed budgets and demonstrated willingness to raise revenues and an ability to control expenditures," Youngens said.
Council members commended staff for the results and noted the outcomes help reduce borrowing costs for projects. The resolutions approving the issuance and sale of the general obligation various purpose bonds (series 2025A) and the general obligation street reconstruction bonds (series 2025B) were adopted as amended, both by recorded council votes of 7 in favor, none opposed.
Why it matters: The winning bids and strong credit ratings lower the city's borrowing costs for capital projects, including street reconstruction, and reflect the council's fiscal management. Staff supplied the bond sale results and related rating reports in the meeting packet for council review.
Ending: The council adopted the bond-sale resolutions unanimously; staff said final sale documents and rating reports are in the meeting packet and thanked bond counsel and financial advisors for their work.
