featured graphic for California State Treasurer Fiona Ma

$2.4 billion in California bond sales include $1.7 billion to refinance previous bonds

California State Treasurer Fiona Ma announced the sale today of $2.405 billion of tax-exempt general obligation bonds, including $664 million earmarked for the funding of K-12 school facility projects.

The bond sale included $1.741 billion of refunding bonds to refinance previously issued bonds under 24 different bond acts for debt service savings, and converts $250 million of variable rate bonds to a fixed rate.

The refunding is expected to save taxpayers $690 million over the next 20 years (or $588 million on a present value basis). Since her election in January, $6.1 billion of general obligation bonds have been refunded under Treasurer Ma, saving taxpayers a total of more than $2.1 billion in the coming decades (or $1.69 billion on a present value basis).

“With this bond sale we are taking advantage of historically low interest rates to finance assets that benefit Californians and save taxpayers money over the long term,” said Treasurer Ma. “We are also following through on our state’s commitment to serve California’s schools and students.”

The bonds for K-12 school facility projects were authorized by the Kindergarten Through Community College Public Education Facilities Bond Act of 2016. The State Allocation Board is expected to apportion the funds to school districts at a meeting on September 25.

Some key statistics from the sale:

  • Final size: $2,405,320,000
  • Final yields to investors: Ranged from a low of 1.07% for a 2020 maturity with a 3% coupon to a high of 2.72% and 2.07% for 2049 maturities with 3% and 5% coupons, respectively.
  • All-in true interest cost: 2.54%.

The joint senior managers for the sale were Jefferies LLC and Stifel, Nicolaus & Company, Inc. Ramirez & Co., Inc. served as co-senior manager. There was also a large syndicate of co-managers and selling group members.

The calendar of all upcoming state bond sales is available at BuyCaliforniaBonds.com.

About the California State Treasurer

Fiona Ma is California’s 34th State Treasurer. She was elected on November 6, 2018 with more votes (7,825,587) than any other candidate for treasurer in the state’s history. She is the first woman of color and the first woman Certified Public Accountant (CPA) elected to the position. The State Treasurer’s Office was created in the California Constitution in 1849. It provides financing for schools, roads, housing, recycling and waste management, hospitals, public facilities, and other crucial infrastructure projects that better the lives of residents. California is the world’s fifth-largest economy and Treasurer Ma is the state’s primary banker. Her office processes more than $2 trillion in payments within a typical year. She provides transparency and oversight for the government’s investment portfolio and accounts, as well as for the state’s surplus funds. Treasurer Ma oversees an investment portfolio of more than $102 billion, approximately $20 billion of which are local government funds. She serves as agent for sale for all State bonds, and is trustee on over $100 billion of outstanding debt.

The article above was released by the California State Treasurer.