DALLAS – Hockley County in the Texas panhandle sold general obligation bonds yesterday to fund construction of a new multipurpose center.
The sparsely populated, rural county about 30 miles west of Lubbock sold $14.5 million of GO bonds through a negotiated sale with RBC Capital Markets Corp. and Morgan Keegan & Co. as co-managers.
First Southwest Co. is the financial adviser to the county, and Bickerstaff Heath Delgado Acosta is bond counsel. Fulbright & Jaworski LLP is underwriters counsel.
The bonds, which were structured as serials maturing in 2010 through 2019, are insured by Assured Guaranty Corp. Yields ranged from 0.80% with 4% coupon in 2010 to 3.60% with a 4% coupon in 2019. The bonds aren’t callable.
This sale exhausts a bond authorization approved by voters in May.
Standard & Poor’s assigned a AA-minus rating to the sale. Analysts said the county’s credit strengths include sustained property tax-base growth and diversification, consistently sound financial performance, and low overall debt.
“A lack of formalized financial policies offset these factors,” according to analysts
“We expect that the county’s economy will continue to remain stable, despite any potential volatility with the concentrated tax base,” Standard & Poor’s credit analyst Kate Choban said. “We also expect that the county will maintain its sound financial position while addressing any capital needs in the future.”
Officials have managed to increase the county’s general fund balance each of the past five years to about $5.1 million for fiscal 2008.
Hockley County’s current population of about 22,200 is down slightly from a few years ago. Still the county’s fiscal 2009 taxable-assessed value of $3.83 billion is more than double the $1.67 billion for 2005.
Standard & Poor’s said the property-tax base is rooted in extensive oil and gas production and services related to the petroleum industry, as well as agribusiness. Analysts also said the county seat of Levelland is a regional center for higher education and medical care.
The new multipurpose center, which replaces an aging stock show barn and building that were built more than 50 years ago, will be in Levelland.
“The list of anticipated uses include banquet and reception accommodations for up to 800 people, youth rallies, concerts, car shows, livestock shows, rodeo or other equine events, dog shows and much more,” Paul Pinkert of the multipurpose committee told the county commissioners in March when they court approved the bond election.
Moody’s Investors Service rates the county’s underlying credit at A1 and Fitch Ratings doesn’t rate the credit.
