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Home > Leadership > City Comptroller > Archive Press Releases > 2010 Press Releases > City Comptroller Announces First Competitive Bond Sale In 24 Years

City Comptroller Announces First Competitive Bond Sale In 24 Years

CONTACT: ROBBIE ANN McPHERSON
(716) 851-4987 office (310) 433-7443 cell


Bond Proceeds Will Fund City and Buffalo School District Improvements

Buffalo City Comptroller Andrew A. SanFilippo announced today that the City’s first competitive bond sale in more than 24 years was a “significant accomplishment,” and proof of Buffalo’s improving financial status in the bond market.

“It’s a proud day for Buffalo. We had seven bidders on each of two bond series,” SanFilippo said, “and these were aggressive bids.  The end result was a spectacularly low interest rate for each bond issue.”

The two-step bidding structure began Wednesday morning with $22.7 million in General Improvement Bonds, sold to fund 37 City improvement projects.  In a process similar to an online auction, competitive bids on interest rates were entered right down to the wire. The final winning bid came in from J.P. Morgan Securities, which offered a low true interest cost (TIC) of 3.626 percent on the deal.

The second bidding Wednesday, for $4.9 million in School Serial Bonds, also went down to the wire, with the winning bid coming in from Morgan Stanley & Co., Inc at a TIC of 3.53 percent—just eight seconds before closing.

“These were extraordinarily close bids,” SanFilippo said. “For our first attempt in the competitive market in 35 years, as opposed to negotiated bond sales, seven bidders on each issue represents our positive creditworthiness and tremendous acceptance in the marketplace.”

 “ Buffalo is now a player in the competitive bond market again and hopefully this will continue to translate into lower borrowing costs for the taxpayers,” SanFilippo added.

The City bond proceeds will be used to fund, among other projects, new police and fire radio systems ($1.6 million), citywide infrastructure improvements ($4.8 million), and $722,000 for community center upgrades.

 The School Series bond proceeds will fund school improvements.

 “Buffalo has been fiscally scratching and clawing its way back since the nineteen seventies,” SanFilippo said, “and this represents a very triumphant return to the competitive bond market. For the people who continually knock our city, it’s an example of Buffalo headed in the right direction.  Even in a tough economy, with tough budget decisions that have to be made, here is a glimmer of hope that we are on our way up, not down.”