Stonington sells bonds for school, boathouse park projects
Stonington — The town announced Thursday that it has sold $17.2 million in bonds for the first part of the $67 million elementary school renovation and expansion project and wrapped the borrowing for $2.2 million Mystic River Boathouse Park project into the bonding to save administrative costs.
The town received seven bids for the bonds, which yield interest rates of between 2.58 and 2.7 percent because of the town’s strong bond rating.
“It is great to know that our bonds were in such a high demand, and this is due in no small part to the excellent job done by our Board of Finance over the years,” First Selectman Rob Simmons said in announcing the sales.
Simmons said that by combining the boathouse and school project bonding, the town saved the cost of issuing the bonds separately.
Residents overwhelmingly approved the boathouse project at a town meeting last month.
“Today’s results were driven by the Town’s strong credit rating and prudent financial management of the Town,” said Matthew Spoerndle, senior managing director of Phoenix Advisors and the town’s financial adviser, in the announcement. “Standard & Poor’s (which establishes the town’s bond rating) recognized the work town officials have done to continue to improve Stonington’s fiscal health over the years, and as a result, the Town is able to issue debt at very low levels. Today’s results were exceptional.”
The town’s “AA+” rating is just below S&P’s highest bond rating of AAA.
In its rating, S&P noted the town’s “strong budgetary performance,” “very strong budget flexibility” and “very strong liquidity.” It also noted the town’s strong economy and tourism industry.
The Board of Finance has worked for years to build up and then protect the town’s undesignated fund surplus of about $11 million because it indicates the town is in good financial health and is a factor in preserving the high bond rating.
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