The Tennessee State School Bond Authority last week closed on a $437.7 million bond deal that will save the state $27.8 million while financing construction projects at colleges and universities.

Part of the savings was achieved because of the “strategic decision” to eliminate the reserve fund that had been included on previous bond issues, according to officials.

The authority “took advantage of its strong rating and good market conditions to get the lowest interest rates in the authority’s history,” officials said.

The bonds are rated AA-plus by Fitch Ratings, AA by Standard & Poor’s, and Aa1 by Moody’s Investors Service.

The debt sold as $208.3 million of Series A bonds, $103.8 million of Series B and $125.6 million of Series C. The Series A bonds priced with yields ranging from 0.54% in 2013, 2.63% in 2027, to 3.62% in 2042.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.