City of Alexandria Refinances General Obligation Bonds at Historically Low Rate

FROM THE CITY OF ALEXANDRIA: 

City of Alexandria Refinances General Obligation Bonds at Historically Low Rate

For Immediate Release: March 21, 2012

News Highlights

• Alexandria refinances $66.5 million in general obligation bonds at historically low interest rates, saving $3.58 million in future debt service costs
• City’s top AAA/Aaa bond ratings reaffirmed

On March 21, the City of Alexandria competitively bid and refinanced $66.5 million in previously issued City general obligation bonds to lower interest rates.  The new bonds were rated AAA/Aaa by Standard & Poor’s and Moody’s Investors Service and were sold at a very low overall 1.98% true interest cost, one of the lowest rates ever achieved by the City.  Nine underwriters bid on the City’s bonds, with J.P. Morgan Securities LLC submitting the lowest interest rate bid.

This refinancing action will save the City about $3.58 million over the life of the bonds.

“Getting Alexandria’s AAA/Aaa ratings reaffirmed indicates that the Alexandria City Council and City management continue to demonstrate strong financial and budget polices, and our overall long-range strategic direction is solid,” said Alexandria Mayor William D. Euille. “Attaining an interest rate below 2.0% is a very exciting achievement that saves the City over $3.5 million in 2013.” 

Standard & Poor’s (S&P) and Moody’s Investors Service reaffirmed the City’s bond ratings of AAA and Aaa, respectively. In reaffirming the City’s AAA bond rating, S&P noted that the City’s rating reflects a “deep, diverse, and strongly performing local economy,” and “strong financial performance and management.”  Moody’s Investors Service agreed, declaring that the City’s financial strengths include a “strong and vibrant tax base,” “a sound and stable financial condition,” and “conservative budgeting practices.”