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In Latest Bond Sale, State Treasurer Passes Half-Billion Dollars Mark of Savings in First Term

Washington State Legislative Building dome

OLYMPIA – Backed by strong ratings and steady investor interest, the Office of the State Treasurer (OST) today refinanced $507,510,000 of previously issued bonds, saving millions in debt service costs by locking in lower interest rates. Upon finalizing today’s sale, OST will now have generated $532.2 million in net present value savings since the beginning of 2021.

“From the outset of my first term, our team at the Treasury has implemented a successful refinancing strategy to take advantage of the refunding opportunities and favorable interest rates that we’ve seen over the past few years,” said State Treasurer Mike Pellicciotti. “Sound government practices pay off, and maintaining Washington’s high credit ratings paired with effective management of our state’s debt portfolio has directly contributed to saving taxpayers more than a half-billion dollars.”

Three of the largest credit rating agencies recently affirmed Washington’s strong credit ratings, which contributed to the favorable interest rates the state achieved for this week’s bond sale. Moody’s Investors Service issued the highest possible rating of Aaa to Washington, while Fitch and S&P each maintained an impressive AA+ rating of the state.

Despite ongoing interest rate volatility, Washington bonds continue to be in demand with investors. Top rating agencies referenced Washington’s strong economic fundamentals, strong governance practices, and sound reserves as key factors in the state’s strong credit ratings.

Sale Summary: 

Various Purpose General Obligation (VPGO) Refunding Bonds, Series R-2024A

The $289,660,000 VPGO bonds were issued to refinance $311,490,000 of previously issued bonds used to pay for various state capital projects.

The State received six bids for the VPGO bonds (maturities 2024-2039) with underwriter BofA Securities submitting the winning bid with a True Interest Cost (TIC) of 3.75%.

Motor Vehicle Fuel Tax and Vehicle Related Fee General Obligation (MVFT/VRF GO) Refunding Bonds, Series R-2024B

The $181,845,000 MVFT/VRF GO bonds were issued to refinance $196,020,000 of bonds previously issued for transportation projects.

The State received eight bids for MVFT/VRF GO bonds (maturities 2025-2039) with underwriter BofA Securities submitting the winning bid with a True Interest Cost (TIC) of 3.77%.