Minnesota's Met Council Readies Sale

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CHICAGO — The Metropolitan Council of the Twin Cities takes competitive bids Wednesday on $150 million of general obligation bonds to fund parks, transit, and wastewater projects in the region.

The sale offers three series, including $45 million of debt for transit, $100 million for wastewater, and $6 million for parks. All are backed by the council's full faith and credit although some of the debt is repaid by user-related revenues.

Ahead of the issue, Moody's Investors Service and Standard & Poor's on Monday affirmed the council's triple-A GO ratings on $1.5 billion of debt.

The Aaa rating reflects the Metropolitan Council's strong regional economy, well-managed general fund financial operations; sound transit operations despite volatility of certain revenue; and satisfactory sewer system financial operations with growing sewer access fee reserves following large declines, Moody's said.

The credit also benefits from a low direct debt and pension burden as a percent of the full value of the property tax base.

"The AAA rating reflects our assessment of the Minneapolis-St. Paul metropolitan area's strong and diverse economic base, the council's strong financial position and fiscal management, and the council's moderate overall debt burden," said Standard & Poor's analyst Jennifer Boyd. "The stable outlook reflects our anticipation of the regional economy's stability and the council's maintenance of a strong financial position."

The Metropolitan Council was created by the state in 1967 to coordinate planning and development within the seven counties of the Twin Cities region with a population of 3.4 million. Its core responsibilities include regional transit operations, regional wastewater treatment, and regional growth and development oversight and planning.

Debt service on the bonds is secured by the council's GO unlimited tax pledge which benefits from a dedicated property tax levy. The wastewater bonds are expected to be repaid by system revenues.

Springsted Inc. is financial adviser and Kennedy & Graven is bond counsel.

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Transportation industry Minnesota
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