Maryland (STOMD1), one of nine states with a AAA general-obligation debt grade from Standard & Poor’s, plans to sell as much as $922 million of tax-exempt bonds next week in its biggest offering since at least 1990.
The sale includes $600 million in bonds for capital projects and grants to local governments for schools, community colleges and jails, according to offering documents.
“We’re doing more new money because we’re using the money more quickly than we have been in the past, with good interest rates and trying to boost jobs and employment,” Treasurer Nancy Kopp said in a telephone interview.
The state had a 6.7 percent December jobless rate that was less than the 8.5 percent national average.
The issue’s longest maturity is a 15-year portion, according to data compiled by Bloomberg. Yields on top-rated 15- year municipal bonds fell to 2.98 percent last month, the lowest since at least 1991, Bloomberg Fair Value data show.
About $322 million is intended to refund debt, a smaller amount than originally planned, Kopp said. A Moody’s Investors Service report from Feb. 22 said Maryland would be issuing $500 million for refunding.
The decision on selling refunding debt “depends on the market conditions on that particular day,” Kopp said. The state won’t issue the bonds unless it can achieve at least 3 percent in present-value savings, she said.
Maryland sold about $656 million in March 2005, its largest issue to date, according to Bloomberg data.
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