Olympia Issues City Hall Bonds

Olympia Receives AA Rating from Standard & Poors and A1 from Moody's .... Issues Build America Bonds for New City Hall

The City of Olympia today issued $35 million in bonds to pay for construction of Olympia’s new City Hall. The bonds were issued in part through the Build America Bonds (BABs) program created by the federal Economic Recovery and Reinvestment Act of 2009. The Build America Bonds program is intended to assist state and local governments in financing capital projects at lower borrowing costs, stimulate the economy, and create jobs. BABs are taxable bonds; however, the Federal Government will refund 35% of the interest back to the City twice a year.

Last Friday, Standard & Poors (S&P) rating agency assigned Olympia its ‘AA’ long-term rating for the bonds and Moody’s retained the A1 rating. According to S&P, the favorable rating is due to the City’s track record of strong and sustained financial performance, good financial policies and practices, and low-to-moderate debt burden. According to Olympia’s Finance Director, Jane Ragland Kirkemo, the S&P rating is the highest the City can expect to receive based on its financial size.

“Because of the both the solid ratings from Moody’s and Standard & Poor’s and the benefits from participating in the federal Build America Bonds program, we were successful in issuing bonds with a True Interest Cost of only 4.2% and at a total estimated interest savings of about $3 million,” says Olympia Mayor Doug Mah. According to Mah, Olympia is the first City in Washington State to issue Build America Bonds.

Olympia’s new City Hall is being constructed in the 600 block of Fourth Avenue East in downtown Olympia. When open in early 2011, services now provided in several different buildings will be co-located in the new space for improved customer service and efficiency.

A model and drawings of the building are available for public viewing the lobby of the current City Hall, 900 Plum Street SE, during regular office hours. Hoffman Construction of Seattle and Belay Architecture of Tacoma are the development partners. Once constructed, the City intends to apply for LEED (Leadership in Energy and Environmental Design) certification for the new building.

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