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Friday, July 17, 2009

Bleeding Heartland: I-JOBS bonds sold well, will cost less to repay

Excerpted from this post at Bleeding Heartland

Most of the bonds that will fund the I-JOBS program were sold this
week, and Iowa's solid credit rating fueled strong investor interest.
... Over $600 million of the I-JOBS bonds have now been sold. Another
$115 million of bonds will be issued in 2010. Speaking to me by phone
today, Fitzgerald explained that the I-JOBS bonds are rated AA (a
notch lower than the state of Iowa) because they will be repaid out of
gaming revenues. We would have had to issue A-grade bonds if Iowa were
like other states, which have exhausted their reserve funds and are
borrowing simply to meet budget obligations. Investors liked the fact
that the I-JOBS bonds will fund capital improvements and not ongoing
government spending, Fitzgerald said.

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Mike Schramm
Andy Szal

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