Wilmington, DE (February 17, 2022) – Finance Secretary Rick Geisenberger announced today that Delaware successfully sold $255 million in general obligation bonds in a competitive bond sale on Wednesday. Of the amount sold, $32.5 million represents a refinancing at lower interest rates, saving taxpayers more than $7.8 million in total debt service over the next 12 years.

“I again thank State employees and the General Assembly,” said Governor John Carney.  “Working together over the past 5 years, we have successfully managed the State’s finances through the turbulence of a major budget deficit, a pre-pandemic recovery, and the COVID emergency.   Now through the resilience of all Delawareans and our business community, we’re emerging from the pandemic stronger than ever.  This confidence is reflected in the public markets by this very successful bond sale.”

The State’s annual sale follows the recent announcement from Fitch, Moody’s and S&P Global Ratings that Delaware has maintained the highest possible AAA rating for its bonds. The rating is assigned based on criteria measuring the state’s economy, financial management, debt load and long-term costs. All three ratings reports highlight Delaware’s history of strong financial governance and specifically note regular fiscal updates, long-term forecasts, and reserve and debt management policies as contributing to the State’s ability to navigate national financial shocks.

Bond proceeds will fund numerous capital projects previously authorized by the General Assembly-including close to $200 million in school construction projects plus funding for housing and community development, National Guard training facilities, the Delaware Public Health Lab, library construction, court facilities, higher education campus improvements, and the rehabilitation of park and wildlife areas.

“Delaware has a well-earned reputation for strong fiscal governance and controls that has been built over many decades,” said State Treasurer Colleen Davis.  “The State’s liquidity has never been stronger and with the guidance of the Cash Management Policy Board, my office will continue its work to build the confidence that underlies the State’s Triple-A bond ratings.”

“Over the last two years, the State has sold $875 million in bonds at an extraordinarily low, average interest cost of 1.76%,” said Secretary Geisenberger.   “Re-affirmation of the State’s Triple-A bond ratings helps to ensure that State taxpayers will continue to save millions of dollars in financing costs and are a testament to the State’s long-term commitment to economic and financial stability.”

The State of Delaware has once again received the highest possible AAA rating from three of the nation’s top rating services, confirming the State’s stable economic outlook for the coming year. The latest round of rating reviews from Fitch, Moody’s and S&P Global Ratings precede the upcoming competitive bid bond sale, intended to fund the State’s ongoing capital program as well as re-funding previous bonds for debt service savings. The sale is scheduled to be held on April 14, 2021.

The rating is assigned based on criteria that include trends in the state’s economy, financial performance and management, overall debt load, and long-term costs. The highest rating, Triple-A, is granted to states that are best able to meet debt obligations during periods of recession or fiscal stress. The higher a state’s credit rating, the lower its cost to repay bonds.

“I want to thank State employees and the General Assembly,” said Governor John Carney. “Our commitment to responsibly managing the state’s spending has provided the financial resilience needed for Delaware to weather the COVID emergency. The continuing strong support of our President and Congressional delegation combined with the resiliency of all Delawareans and our business community will ensure we emerge from this pandemic stronger than ever.”

All three rating reports note the importance of the state’s conservative budget practices, the maintenance of financial reserves, and a proactive approach to tracking and forecasting revenues and expenditures throughout the year. Fitch states that Delaware has “exceptional financial resilience from strong financial management,” which has allowed the state to weather the current COVID-19 pandemic while keeping a stable economic outlook.

S&P notes that “The state continues to see business growth despite the pandemic, including Barclays expanding its U.S. headquarters presence, Goldman Sachs adding a new consumer banking facility, Amazon completing four new facilities, and Incyte (a biopharmaceutical company) adding 400 more jobs.”

Moody’s reports that “Lower business costs and cost of living relative to neighboring states could continue to attract new residents as certain economic sectors have the potential to expand.”

“Thanks to a lot of hard work and the forethought of Governor Carney and his financial team, Delaware is positioned very well,” Treasurer Colleen Davis said. “Strong fiscal controls combined with my office’s handling of cash and investments instill continued confidence that allows the State to maintain its Triple-A bond rating.”

“Delaware’s Triple-A rating continues to save taxpayers millions of dollars through lower interest and financing costs,” stated Finance Secretary Rick Geisenberger. “As state and local governments around the nation wrestle with the fiscal strain of this pandemic, the re-affirmation of Delaware’s bond ratings is a testament to the State’s long-term commitment to economic and financial sustainability.”

Wilmington, DE – Finance Secretary Thomas J. Cook announced today that Delaware successfully sold $236 million in triple-A-rated general obligation bonds in Tuesday’s annual bond sale, effectively netting a savings of over $8 million for Delaware taxpayers.

With triple-A ratings recently re-affirmed by Moody’s Investors Service, Fitch Ratings, and Standard & Poor’s Rating Services, Delaware was able to obtain some of the best pricing relative to the triple-A index in recent history, even in a volatile market. “Credit quality matters and translates into reduced interest costs to taxpayers,” said Cook. “In this case, the triple-A rating saved Delaware taxpayers $5.8 million when compared to double-A rates.”

Of the $236 million of bonds sold, $36 million sold as Series C represents a refinancing at lower rates, saving taxpayers more than an additional $3 million.

“It is our responsibility to ensure we are using taxpayer dollars efficiently and maximizing the return on our investments,” said Governor Jack Markell. “Our triple-A rating, and the benefits that come with it, are the result of the fiscal discipline and prudent financial management that have become Delaware’s hallmark.”

Delaware’s combined cost of capital on this loan was 2.32%. “While not the lowest ever, it is lower relative to other high quality issuers that have been in the market recently,” said Cook. The state received seven bids; awarding Morgan Stanley &Co., LLC as the highest bidder on Series A, J.P. Morgan Securities LLC on Series B, and Bank of America Merrill Lynch on Series C.

The remaining $200 million, Series A and B, represents various capital projects – including over $100 million in school construction projects, improvements to the Veteran’s Home, National Guard readiness facilities, the Port of Wilmington, libraries around the state, and the rehabilitation of park and wildlife areas.

###

Leslie A. Poland
Public Information Officer
Delaware Department of Finance
(302) 577-8522
leslie.poland@delaware.gov

Stephanie M. Scola, Director of Bond Finance for the State of Delaware, has been presented with a Freda Johnson Trailblazer Award by the Northeast Women in Public Finance (NEWPF). The award honors her as a woman who has made an outstanding commitment to the field of public finance, and whose dedication and professional achievements have been recognized by her peers. She was one of ten women from across the country honored at the Bond Buyer’s 14th Annual Deal of the Year Awards Gala at New York’s Waldorf Astoria on December 3, 2015.

As Director of Bond Finance, Stephanie oversees Delaware’s bond program, finding creative and efficient ways to fund state objectives. “I find it particularly satisfying to finance projects for the public good: schools, libraries, and courthouses,” says Ms. Scola. Through her diligence, she ensures that the state’s capital projects are financed at the lowest possible cost of capital and is vigilant for threats to Delaware’s Triple-A rating.

In addition to her many achievements, she was instrumental in making Delaware bonds available to retail investors and has created one of the most comprehensive investor relations sites on the internet, http://www.buybonds.delaware.gov/. The site promotes investor relations, and provides easily accessible, current, and relevant information about the State and its financial position for the public.

“We’re proud to have such an exemplary role model for women in public finance working with us,” said Finance Secretary Tom Cook, “and we congratulate Stephanie on this well-deserved honor. Her dedication to raising Delaware’s profile in the public finance industry is admirable and ultimately helps all Delawareans.”

Trailblazer Awards are given annually to recognized leaders in the public finance industry, with nominees chosen by members of the NEWPF.

###

Leslie A. Poland
Public Information Officer
Delaware Department of Finance
(302) 577-8522
leslie.poland@delaware.gov