Doubling Down on Debt

Birmingham, Ala., Mayor William Bell reportedly wants to ask voters for twice the bonding authority he originally sought, according to the Birmingham News.

Bell initially announced that he wanted to hold a referendum to ask city voters to approve $75 million of bonds secured by an existing, dedicated ad valorem tax to fund various capital improvements.

Last week, Bell said he wanted to increase the authorization to $150 million in order to spend half right away, and reserve the other half of the bonding authority for the future, the paper said.

Bell has begun a series of community meetings on his bond proposal. It is not clear when the city wants to hold the referendum.

Birmingham had around $490 million of outstanding bonds and warrants as of June 30, 2011. A public vote is required to issue bonds, but not warrants.

The city’s bonds are rated AA by both Fitch Ratings and Standard & Poor’s, and an equivalent Aa2 by Moody’s Investors Service.

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Alabama
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