County Bond Sale to Save Isle Taxpayers $8.5M
The County of Hawai’i sold $98.8 million in bonds in a sale that closed Tuesday, obtaining funding for new projects and refinancing old loans and bonds.
The move will save taxpayers about $8.5 million over the life of the bonds, county officials said.
The county’s ratings were affirmed in January by all three major rating agencies: Aa2 from Moody’s, AA- from Standard & Poor’s, and AA- from Fitch. Those represent Moody’s third-highest rating for long-term bonds, and Standard and Poor’s and Fitch’s fourth-highest ratings, respectively.
County officials said those positive ratings recognize the county’s strong fiscal position and effective management, and allowed the county to achieve a very favorable combined interest rate of 2.58% on these new bonds.
“Our county found itself in a great position – with a trio of positive ratings and the excellent market conditions for municipal bonds, we could refinance some of our pre-existing obligations for a lower cost,” said Finance Director Nancy Crawford.
“The savings we realize with this bond issuance will free up resources to do more for the people of Hawai‘i Island,” she said.
The interest rate was slightly higher than the administration anticipated in December when it sought approval from the County Council to refinance old debt. At that time officials predicted interest rates of less than 2%.
In addition to refinancing previous loans and bonds, $27.5 million in new money was obtained to fund new projects authorized by the County Council.
Some of these projects include the improvements to the Edith Kanaka`ole Stadium in Hilo, the La`aloa Avenue Extension in Kona, and an island-wide public safety radio upgrade.
“We’re pleased that we were able to leverage our county’s strong financial position to save our taxpayers money. It is truly a credit to the hard work of our employees and our finance team for managing our resources wisely,” said Mayor Billy Kenoi.
“We’re excited to have funds available to invest in projects that will upgrade our public facilities, better connect our communities, and keep our island safe.”