24 March 2008
The city is ready to sell the first batch of 2007 General Obligation Bonds, approved in December by voters, and I found myself wondering just how much interest they expected to pay on these notes, since the package approved by voters set an upper limit of 10 percent, which seems awfully high for municipal bonds.
This memo from Finance [link goes to PDF file] answers that question. Over 20 years, the payback for $7 million in bonds is projected to be $11.3 million. If I've done the math correctly, this is right around 5 percent, which is consistent with the current market.
(Standard & Poor's upgraded the city's bond rating to AA+ in the spring of 2006, after a couple of decades at the AA level.)Posted at 2:53 PM to City Scene