California State Treasurer Fiona Ma announced approximately $1.1 billion in revenue bonds toward finance projects overseen by the UC Board of Regents on Friday.
Revenue bonds are a type of government-issued bond that in this case funds projects and is issued by the state. According to state treasurer spokesperson Noah Starr, the $1.1 billion total is not subject to change.
According to a press release from Ma’s office, two series of bonds were sold that are meant to finance or refinance various projects of the UC system: $702.3 million in 2022 Series BK tax-exempt bonds and $65.2 million in 2022 Series BL taxable bonds. The remaining $318.0 million comes from 2023 Series BM tax-exempt bonds that are set to refinance previously issued bonds.
Starr noted state law requires the state treasurer to serve as the “Agent for Sale” for all bonds issued by the state or a state department, board, agency or authority.
The joint senior managers of the bond sale were Goldman Sachs and Morgan Stanley, in addition to 20 firms who participated as co-managers, according to the press release. Starr added there were a wide range of investors — individual retail accounts, separately managed accounts, trust departments, investment advisors, bond funds and insurance companies — that placed orders for the bonds.
According to Starr, the bonds were rated Aa2 by Moody’s Investors Service, AA by S&P Global Ratings and AA by Fitch Ratings. According to Fitch Ratings’ website, an AA grade indicates a bond of high credit quality and very low credit risk.
While unable to specify specific projects that would benefit from bonds, Starr referred The Daily Californian to the university, which has yet to respond for comment as of press time.
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