WESTFIELD – Mayor Daniel M. Knapik announced this morning that the city has completed its most recent short-term borrowing program with a $28.5 million sale that attracted four competitive bids.
JP Morgan Securities LLC was the successful purchaser, offering a coupon rate of 1 percent with a premium that lowers the city’s borrowing cost to a net 0.14 percent rate. The city maintains its MIG-1 rating, the highest rating for short-term notes, and the underlying bonds are rated A1 by Moody’s Investor Services.
Moody’s cited healthy reserve balances, the city’s diverse and stable tax base, and rapidly-amortizing general obligation debt as city strengths. The report noted that 87 percent of the city’s debt is slated to be paid-off within ten years. Moody’s also acknowledged the city faces challenges, including funding employee and retiree benefits, certain declining wealth indices, and limitations of Proposition 2 ½.
“I am very pleased with the results of this recent bond sale,” Knapik said. “The past few years have presented city government with serious challenges, including declining state aid and unavoidable significant investment in infrastructure, but the markets have demonstrated that Westfield is a safe and responsible investment.”
This sale was for bond anticipation notes on previously-approved projects, including energy conservation and management systems and improvements at city and school buildings; road design, construction and improvement; and improvements to Westfield Barnes Regional Airport. This process serves as a bridge-financing mechanism until bonds can be sold upon completion of these projects.
“Our financial team has done an excellent job preparing the city for this bond sale,” Knapik said. “The auditor, treasurer, collector, and assessor’s offices prepared countless reports and background information so that ratings agencies could properly analyze our position and brokers could attract competitive bids.”
