CHICAGO – On Wedsday, the State of Illinois borrowed $750 million in General Obligation bonds for 2018 capital expenditures.
Bond proceeds will be used to fund major capital construction projects and finance information technology projects.
The General Obligation bonds were priced competitively in two separate bids:
- The $655,000,000 Series of December 2017A, fixed-rate bonds with a final maturity in 2042 will be used to fund major capital construction projects. The 2017A bonds received eight bids and the bonds were awarded to Bank of America Merrill Lynch with a true interest cost of 4.33 percent.
- The $95,000,000 Series of December 2017B fixed rate bonds with a final maturity in 2027 will be used to finance information technology projects. The 2017B bonds received 10 bids and the bonds were awarded to Bank of America Merrill Lynch with a true interest cost of 3.71 percent.
Today’s bond issues have borrowing costs for the combined series of 4.29 percent. The bonds are being issued as fully tax-exempt from federal taxation and are rated “BBB” by Fitch Ratings, “Baa3” by Moody’s Investors Service and “BBB-” by S&P Global.
“We are very pleased with the strong response that the State received on today’s competitive bids,” said Scott Harry, director of the Governor’s Office of Management and Budget. “These transactions will allow the State to move forward with funding to address essential capital and infrastructure needs at an attractive interest rate.”
Chapman and Cutler LLP and Hardwick Law Firm LLC are acting as co-bond counsel for the State. Chapman and Cutler LLP is the State’s disclosure counsel. The State’s financial adviser for the transaction is Sycamore Advisors LLC.