LANCASTER – The city of Lancaster recently closed $50 million in a Measure M and Measure R sales tax revenue bond issue that raised funds for the extensive road improvement and replacement program that is part of the city’s “STIR” (Strategic Technology, Innovation, and Resiliency) initiative, which focuses on improving and enhancing city infrastructure. Issued with a rating of AA- from S&P Global Rating, the bonds were sold at very favorable interest rates to institutional as well as retail investors across California and the United States.
“These bond funds will help the city of Lancaster invest in new road improvements and rehabilitate transportation links throughout critically important parts of the community. This funding will also propel and accelerate Lancaster’s Revive 25 program for the benefit of all residents and stakeholders,” Lancaster Mayor R. Rex Parris said in a news release. “Lancaster residents voted for these measures to expedite and expand the delivery of essential infrastructure developments. Through low-cost financing and the leveraging of the Measure M and R funds, we are in a better position to achieve these goals, and will use the bond proceeds to facilitate the expedited design and construction of local streets.”
As a result of the AA- bonds rating, bond insurance was not required, thus saving the city approximately $240,000. An additional $410,000 was saved due to the bonds being sold at very favorable interest rates. The $650,000 in total savings will go towards more street projects throughout Lancaster.
“We are very pleased with the results of this financing. The City Council directed staff to maximize the amount of the new proceeds within a set of conservative financial parameters, and we achieved that goal through an effective collaborative effort,” Lancaster City Manager Jason Caudle said in a news release. “Prudent financial management, including targeted borrowing such as this bond financing, helps the city continue to deliver vital services to our residents, thereby ensuring the city flourishes into the future.”
[Information via news release from the city of Lancaster.]