DALLAS - Pima County, Ariz., will price about $160 million of debt in a series of negotiated and competitive deals this month.
The issues include $26 million of Highway User Revenue Fund bonds for transportation projects, $70 million of sewer bonds, $10 million of general obligation bonds, and $53 million of certificates of participation.
The county is also planning to defease about $17 million of outstanding general obligation bonds from existing funds, according to county administrator Chuck Huckelberry.
Only the HURF bonds are pricing competitively, with bids due Jan. 14. Arizona state law requires competitive pricing of those bonds. RBC Capital Markets Managing Director Kurt Freund serves as financial advisor.
The GO bonds will go to market Jan. 16 with RBC as senior manager.
The sewer bonds, which will price through negotiation Jan. 21, earned a Standard & Poor's ratings upgrade to AA from AA-minus on Jan. 7. The outlook is stable.
"The upgrade reflects our view of Pima's demonstrated willingness to raise sewer rates and fees as needed to maintain senior and total debt service coverage at levels we consider strong and good, respectively," said Standard & Poor's credit analyst Joseph Pezzimenti. "The upgrade also reflects our analysis of a strong liquidity position that we expect to continue and a decreased reliance on connection fees and nonrecurring revenue sources."
On Dec. 31, S&P affirmed its AA-minus general obligation rating on the county and rated the certificates A-plus with stable outlooks.
Fitch Ratings affirmed its AA rating on Pima's GO and HURF bonds while rating the COPs AA-minus. Outlooks are stable.
The COPs will price Jan. 28, according to Tom Burke, finance and risk management director for the county.
"Given the high grade credits of the County, and the fact that the maturity length for our transactions falls in the more attractive shorter end maturities -- as all of our debt is financed within 15 years or less -- we have found that investor demand for our bonds has traditionally been very good," Burke said. "I suspect that will continue on these sales and we look forward to favorable results."
The county will use the certificates to complete construction of a new county office building, Huckelberry said.
"We continue to experience low interest rates for borrowing and have not extended our debt repayment period for any debt issue," Huckelberry told county commissioners in a report last month. "We will, in fact, accelerate principal debt repayment of our general obligation bond debt with the cash defeasance."
