Howard County Taxpayers to Save a Total of $18.5M

From Howard County Government: Howard County taxpayers will save $18.5 million as a result of the annual bond sale conducted this week. The sale offers both Consolidated Public Improvement (CPI) new and refunding bonds and Metropolitan District Bonds via competitive bidding. These bonds are highly valued in the marketplace in large part due to the county’s Triple-A credit rating, which was affirmed by all three bond rating agencies last month. In all, five bidders made offers to purchase the bonds.

“Despite only moderate revenue growth, we’ve made budget decisions that are sustainable and help us maximize taxpayer dollars. By getting very low interest rates for our bonds, we can make our money go farther,” said Howard County Executive Allan H. Kittleman. “This means county taxpayers will pay less for needed capital improvements and to improve our infrastructure.”

Kittleman, in his $374.3 million Fiscal Year 2018 Capital Budget proposal, included funding for school construction and continued investments in public safety, parks and infrastructure projects, including replacing the outdated circuit court house.

County Finance Director Stan Milesky added, “In addition to getting favorable interest rates, the county will save taxpayers over $12 million in CPI and over $6 million in Metropolitan District bonds in long term interest cost by selling refunding bonds along with this sale to refinance existing bond debt.”

The bond sale exceeded the County’s pre-sale projections and included:

• An accepted offer to purchase $133,925,000 in CPI Project Bonds, Series A from Bank of America Merrill Lynch at a True Interest Cost (TIC) of 2.96 percent;
• An accepted offer to purchase $140,385,000 in CPI Refunding Bonds, Series B from Citigroup Global Markets, Inc. at a TIC of 2.26 percent and saving the County $12.1 million;
• An accepted offer to purchase $81,515,000 in Metropolitan District Project and Refunding Bonds, Series C (used to finance water and sewer system improvements, which included a $23,610,000 new money issuance and a $57,905,000 refunding issuance) by Barclays Capital Inc. at a TIC of 3.11 percent and saving taxpayers $6.4 million.

Now that it has accepted these offers, the County expects to close on the bond sale later this month.

At the end of March, Howard County was one of just 43 counties, among more than 3,000 in the U.S., to earn an AAA credit rating from all three bond ratings agencies. In awarding the highest possible score, Fitch Ratings, Moody’s Investor Services and Standard & Poor’s all recognized the County’s vibrant economy, diverse revenue streams, and strong financial policies and practices as evidence of fiscal responsibility and resilience.

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