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On Tuesday, December 13th the Town of Madison sold $8,200,000 in one-year bond anticipation notes through a competitive bid process. The notes were purchased by Jefferies LLC at an effective rate of 2.772%. The Town received a total of 6 bids on the notes with rates ranging from 2.77% to 3.79%.
According to the Town’s municipal advisor, Munistat Services, Inc., the Town’s debt is attractive to municipal bond investors because of the Town’s superior bond rating and strong reputation in the market.
In connection with the sale, Moody’s Investors Service affirmed the Town’s “Aaa” long-term bond rating and applied its highest short-term rating, “Moody’s Investment Grade 1”, to the notes. In its rating report, Moody’s described the Town as having “above average resident income and economic growth that is comparable to national performance” as well as “a strong financial position highlighted by solid fund balance and liquidity and low long-term liabilities and annual fixed costs” as key rating drivers.
Proceeds of the notes will be used to finance a new elementary school and renovation of the former Academy school to a Community Center. The notes are the first installment of a series of debt issuances planned for those projects over the next five to six years.
The Town was assisted in the sale by Munistat Services, Inc. of Madison as municipal advisor and Shipman & Goodwin of Hartford as bond counsel.