Important Projects Statewide to be Financed with Help from Treasurer
Essential Equipment and Capital Projects Statewide to be Financed Tuesday with Help from State Treasurer
State Treasurer Mike Pellicciotti and his office’s debt management team are finalizing preparations for an important transaction this week that will provide necessary financing for two dozen local and state capital projects and equipment purchases. Twelve local municipalities from across the state, three community colleges, and three state agencies partnered in a program offered by the Office of the State Treasurer, known respectively as the LOCAL (Local Option Capital Asset Lending) Program (for municipalities) and the Lease Purchase Program (for community colleges and state agencies), to issue Certificates of Participation (or “COP”).
By utilizing these programs, the participants are able to pool together with and capitalize on the premier credit rating enjoyed by the state, allowing them to borrow at lower rates than they would be able to on their own. For this sale, The Treasurer’s Office is financing $25.1 million worth of equipment and capital project purchases and refinancing $7.5 million of existing obligations. The Treasurer’s Certificates of Participation Program can provide the financing needed to acquire new property, help current projects move forward, or provide refinancing opportunities for previously COP financed projects.
“We’re able to leverage the state’s financial strength while interest rates are at historic lows, to make sure that Washington’s local governments can provide communities with the essential services they need and create additional savings for taxpayers,” said State Treasurer Mike Pellicciotti.
Shoreline Community College is one of the participants planning to make use of the Certificates of Participation Program to finance Shoreline’s new Health, Science & Advanced Manufacturing Classroom Complex — a 51,600 square foot complex that will serve up to 800 students per year — replacing five small one-story buildings at the north end of its campus that are between 45 and 52 years old.
Financing for the new building has allowed Shoreline to create strategic partnerships in biomanufacturing and develop a pipeline that will move students directly into paid internships at $20 per hour in 10 weeks. Associate Vice President Diana Dotter said she is focused on providing a highly skilled workforce to the biotechnology sector, which is experiencing explosive growth and challenges filling essential entry-level jobs.
“We are working together with partners to address a critical need in the biotech industry — a workforce need,” said Dotter. “Growing Washington’s economy starts with training our workforce. This new building will help Shoreline maintain its role as a provider of top-notch training for the most in demand industries today,” she said.
Throughout the last decade, the Office of the State Treasurer has delivered $1,491,660,000 of funding to participants of the Certificates of Participation Program, providing the lowest possible financing cost for state and local government participants hailing from all corners of the state. Other types of municipalities seeking to keep financing costs low by participating in the LOCAL Program include hospital districts, and fire districts like Douglas Okanogan Fire District 15.
Okanogan County has been hit particularly hard by wildfire in recent years, having battled 68 fires between January 1 and October 25, burning a total of 162,787 acres according to the Department of Natural Resources. Douglas Okanogan Fire District 15 Fire Chief Bill Vallance said that he is pleased with the financing opportunity that his district was able to obtain through the Treasurer’s Office. “This community faces a constant threat of wildfire during the summer months, so we need to be prepared by having reliable equipment at our disposal,” said Chief Vallance. “The District’s participation in Treasurer’s financing program is simply the most cost effective avenue for us to purchase the equipment needed to keep our community safe,” he said.
Douglas Okanogan Fire District 15 partnered with the Treasurer’s Office, participating in the LOCAL Program to finance the purchase of two fire engines at a cost of $738,230. Grays Harbor County Fire Protection District 5, which serves the surround areas of Elma, is also financing $278,625 for the purchase of a fire engine through the LOCAL Program.
Municipal participants of the LOCAL Program range in size and diversity from counties and large cities, to local water districts and smaller school districts like the Wahluke School District in the City of Mattawa, where there are plans to accommodate an expected influx of 40 additional preschool students by acquiring new modular classrooms through financing provided by the Treasurer’s Office.
“When we started planning to expand our preschool we were already near capacity with 125 preschoolers district-wide, so the new classroom space will be a much welcomed addition to the district,” Wahluke School District Superintendent Andrew Harlow said.
Harlow, who has served the District for the past 20 years as a teacher, coach, advisor, dean of students, and principal said that, based on free and reduced lunch data, his district is 98 percent low income. “We are maxed out on our local levy — our assessed values simply don’t bring us a lot — so when the school board was presented with this opportunity to finance our new modular buildings, it was a no-brainer,” said Harlow.
“That is exactly what we are working to achieve for our local partners, helping their dollar go further by providing the lowest possible interest rates and putting money back where it belongs: into the pockets of Washingtonians instead of Wall Street investors. We’re helping local fire districts, preschools and colleges, and all kinds of local municipalities across the state reach their long-term goals, while keeping costs at a minimum. That’s just good government,” said State Treasurer Pellicciotti.
The third Certificates of Participation issuance of this year is scheduled to for Tuesday morning. Unlike the state’s highly rated GO Bonds, which are backed by the full faith and credit of the State, COPs are backed by installment and rent payments provided by the individual participating agencies. For this reason, COPs are rated one notch lower at Aa1 by Moody’s.
The State Treasurer’s Offices offers financing opportunities three times each year through its Certificates of Participation Program.