Town Earns Lowest Bond Interest Rate Yet
Vienna keeps AAA ratings as it sells $6.45 million in public improvement bonds Tuesday, but 'negative outlook' from credit rating agencies remains
The Vienna Town Council set a new record Tuesday, selling $6.45 million in 2012 Public Improvement Bonds at a rate of 1.71 percent -- a third less than the record rate it earned two years before.
Before this week, the lowest interest rate Vienna had seen on its public improvement bonds was 2.49 percent, earned on the 2010 bond issue.
"By having such a low interest rate, the Town will see substantial savings over the life of the bond, ultimately saving taxpayer money," Public Information Officer Kirstyn Barr said in a statement.
The town goes out for bonds about every four years to fund major public improvements. It repays the debt service using revenues from the town's 3-percent meals tax.
Standard & Poor's and Moody's Investor Service re-affirmed their AAA and Aaa bond ratings for the town before the sale, though the credit rating agencies left their negative outlook on Vienna, a decision driven by the town's close proximity to Washington, D.C.
It's also a historic year for town needs: The 2012 Capital Improvement Plan (CIP) calls for nearly $1.5 million more in bonds than any other issue in the past two decades.
The plan, which has seen several reductions and revisions since it was introduced this winter, including one of more than 50 percent in funding for Town Hall renovations, will spread the $6.45 million across more than two dozen projects, a jump above the town's self-imposed limit of $5 million.
Finance Director Phil Grant said in February the town can expect to sell even more in bonds over the next decade: He expects a $7 million list in 2016 and $7.5 million in 2020 before the town comes close to exhausting its debt capacity — by 2024, it would be limited to just $1 million in bonds, he said.
For more on the town's CIP, click here.
A list of the town's Priority A Bond Projects (taken from town documents):
|Project||Town of Vienna Funding||Other funding||Total Cost|
|Police Facility Assessment||100,000||100,000|
|Emergency Power Generators (Phase I Police)||235,000||235,000|
|Town Hall Renovation Projects||300,000||300,000|
|Business District Parking Facility||--||--|
|Community Center Expansion Assessement||125,000||125,000|
|Meadow Lane & Gibson Drive Storm Drainage||300,000||300,000|
|Ross Drive End Wall||--||--|
|Nutley & Marshall Storm Drainage||500,000||500,000|
|Walker Street End Wall||50,000||50,000|
|Glyndon Storm Drainage Assessment||50,000||50,000|
|Village Green Drainage Assessment||25,000||25,000|
|Center Street Storm Drainage A&E||25,000||25,000|
|Ninovan & Talahi Roads SW Storm Drainage||25,000|
|Drake Lane SW Street Reconstruction||450,000||450,000||900,000
|Center Street South Street Reconstruction||150,000||150,000||300,000
|Lakewood Street RS Local Match||350,000||350,000||700,000
|Spring & Battle Streets RS Local Match||250,000||250,000||500,000
|Mill Street RS Local Match||200,000||200,000||400,000
|Phone System Replacement|
|Vienna Skate Park|
|FHWA Grant Walk-to-Downtown Iniative||200,000||1,000,000||1,200,000|
|Train Station Trans Enhancement Grant||40,000||160,000||200,000|
|New Sidewalk Construction||500,000||500,000|
|Police Facility Land Acquisition||525,000||525,000|
|Water and Sewer Projects||1,590,000||1,590,000|
|Bond Issue Costs||161,000||161,000