The City of Bristol has received positive results from its bond sale on Tuesday, Oct. 29. The city received competitive interest rates based on solid reviews from S&P Global Ratings, and Fitch Ratings, two major Wall Street Rating Agency firms. The city received a total of nine bids for the bonds with Robert W. Baird & Co. Inc. submitting the winning bid, and beating out Bank of America Merrill Lynch, Raymond James, UBS Financial, and Wells Fargo among others.
The interest rates bid on the bonds ranged from a winning bid of 2.39% to a high bid of 2.55%. The winning bid bested the second place bid by 0.05%. These bonds were issued to finance various capital projects including the Memorial Boulevard School, the recently purchased Tower 1 fire truck, Stevens Street – Richard Court Berm improvements, heating, ventilation, and air conditioner upgrades at South Side School and Page Park Pool improvements.
“These were fantastic results primarily driven by the city’s strong credit rating and prudent fiscal management,” said Comptroller Diane Waldron in a press release. “Taking advantage of this historically low interest rate environment to finance various ongoing capital projects, the city was able to issue these bonds at the one of the lowest interest rates ever received by the city.”
“It is wonderful to see that we had such great demand for our bonds,” said Mayor Ellen Zoppo-Sassu in a press release, “and this is due primarily to the hard work we’ve done at City Hall to ensure that the city remains financially strong.”
“Connecticut’s fiscal crisis at the state level has not had a significant impact on Bristol,” Board of Finance Chairman John E. Smith said in a press release, “and we were able to sell at a price that is right in line with other comparable sales that have been done in Connecticut over the last couple of weeks, thereby keeping the tax impact on our citizens as low as possible.”
“The State of Connecticut’s credit rating has suffered in recent years, but S&P and Fitch continue to recognize the work city officials have done to maintain and strengthen its own fiscal health, along with strong economic development activity. As a result, the city is able to issue debt at very low levels,” said Matthew Spoerndle, senior managing director of Phoenix Advisors and Bristol’s financial advisor, in a press release.
S&P recently put Bristol’s rating at AA+ while Fitch gave the city a AAA, representing the highest rating possible. Within the report, S&P referenced the city’s “strong economy” noting the city’s diverse tax base that “continues to experience new and ongoing development.” They also mention the city’s “strong management,” “very strong budget flexibility” and “very strong liquidity” among the factors influencing the city’s high credit rating.
Fitch mentioned the city’s “strong fiscal management” and that officials “continue to maintain its very high level of operating and financial flexibility.” Among other factors, Fitch also notes the city’s very well-funded pension plan as an important credit consideration contributing to the city’s AAA rating.
The settlement date for the sale is Nov. 12, after which the funds become available to the city.