RI issues nearly $4M in bonds for infrastructure work, refinancing


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Posted Online: Dec. 11, 2012, 6:07 pm
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By Eric Timmons, etimmons@qconline.com
The city of Rock Island has issued $3.89 million in bonds to financestreet and other infrastructure improvements and to refinance some of the city's old debt.

The city secured an interest rate of 2.2 percent on the bonds, which will be paid off over 20 years. They bring the city's outstanding general obligation debt to $38 million.

Moody's Investor Services assigned the city an Aa2 credit rating ahead of the bond sale, which Mayor Dennis Pauley said helped secure a low interest rate. An Aa2 rating is the third best available and indicates that Moody's regards Rock Island as a very low credit risk.

"This positive bond rating reflects our commitment to do what is needed to maintain the city's financial strength," a statement from City Manager Thomas Thomas said.

Money from the bond sale will be used to pay for $1.5 million in public infrastructure improvements at Ridgewood Road Sustainable Business Park. The bond sale also will finance a $430,000 project to reconstruct 44th Street from 41st Avenue to Blackhawk Road and the reconstruction of 37th Avenue, east of 44th Street for $195,000.

The remainder of the bond issue will be used to service outstanding debt from previous bond sales at a lower interest rate, saving the city $44,000, according to Rock Island's finance director Cindy Parchert.

A Moody's report said the Aa2 rating for Rock Island "reflects the city's relatively stable tax base in the Quad-Cities metropolitan region and diverse tax base."

The Moody's report said the city had "sound financial operations with healthy reserves despite revenue pressures and above-average yet manageable debt burden."

Challenges to the city's strong debt rating include below-average wealth indices in Rock Island, declining population and a dependence on "economically sensitive revenue sources," the Moody's report noted.

The Aa2 rating gives Rock Island a stronger credit rating than Rock Island County, which was downgraded from Aa2 to Aa3 in August by Moody's. The city of Moline was assigned an Aa2 rating in July and last December, Moody's assigned an Aa3 credit rating to East Moline.

Investors bid on bond offers by municipalities, and those with the highest credit rating typically win the lowest interest rate. Municipalities usually request a credit rating before a bond sale to make their debt easier to sell.


















 



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  Today is Monday, April 21, the 111th day of 2014. There are 254 days left in the year.

1864 -- 150 years ago: The female sex seems to have gone crazy on the subject of dry goods. When high prices keep them from increasing their wardrobes, they turn to stealing. Yard goods, hats, shoes and other items are being picked up and carried home.
1889 -- 125 years ago: Members of Everts Commandery No. 18, Knights Templar, under Commander H.C. Cleaveland, marched from the Masonic Temple to Trinity Episcopal Church for their annual Easter services.
1914 -- 100 years ago: Nate Hultgren pitched the Augustana College baseball team to a 10-3 victory over Carthage, striking out 11 men and allowing only four hits.
1939 -- 75 years ago: Marvel Leonhardi, a Rock Island High School senior, was the winner of an essay contest on advertising sponsored by The Argus and Advertising Age, a national advertising publication.
1964 -- 50 years ago: The Augustana College band drew a crowd of 1,200 people for its annual home concert in Centennial Hall. The size of the crowd was indicative of the fact the band is rapidly approaching the stature of the Augustana Choir.
1989 -- 25 years ago: A benefit to raise money for extracurricular activities in the Rock Island Milan School District will be April 27 at the Quad City Downs harness race track. People buying $17.50 tickets to the second annual "Night at the Quad City Downs" will be entitled to an evening of harness racing and dinner.






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