SALISBURY – Officials say a high credit rating and a large bond issuance attracted 12 bidders to Wicomico’s $58 million bond sale.
The Wicomico County Council voted this month unanimously to approve a resolution awarding $58.23 million in general obligation and tax-exempt bonds to finance several major projects in the county. Finance Director Pam Oland told county leaders the bond solicitation resulted in 12 bidders and a low true interest cost of 1.625%.
“When we went to the market in 2018, over 3% was our interest rate …,” she said. “2017 was the lowest interest rate that we’ve gotten before, and that was 2%. So we beat our 2017 number and almost halved our 2018 number.”
Wicomico County’s bond issuance includes funding for a new public safety building, a renovation and addition at Mardela Middle and High School, the construction of a new landfill cell, and a new Applied Technology Building at Wor-Wic Community College, among other things.
Oland noted that the county also sold $16.95 million in taxable bonds last week to refund existing debt at a lower rate. The taxable bonds had eight bids and a true interest cost of 1.849%.
“That will result in savings of over $900,000 over the remaining life of the bonds,” she said.
Councilman John Cannon applauded the results of the bond sale.
“That’s really fortunate that it turned out like this because this is really one of the largest bonds that we’ve ever put out there,” he said. “And to have the opportunity with the lowest financing I can remember in a long time, that is very good.”
Oland added, “The number of bidders was very strong, and the fact that the county got that many bidders in both sets is a testament to our bond rating and what we show as the strength of the county.”
In November, Wicomico County received a AA+ rating from S&P Global Ratings and a Aa2 rating from Moody’s Investors Service. Acting County Executive John Psota argued those ratings, coupled with Wicomico’s strong financial position, led to a successful bond offering.
“All of these projects are critically important for Wicomico County and I am pleased to report they are moving forward,” he said in a statement. “Such favorable reports from the credit rating agencies, along with a very strong market response to our bond offering, reinforces that our fiscal management in Wicomico County continues to be strong.”
After further discussion, the council voted 6-0, with Councilman Ernie Davis absent, to approve the resolution.
