“I am pleased that the markets have responded so well to my Administration’s efforts. With each bond transaction our reputation in the financial markets continues to improve. These savings are essential to my administration’s efforts to provide valuable tuition support to UOG students, tax refunds and funding for the Mayor’s Council. Many thanks to Speaker Won Pat, Sen. Barnes, and former Sen. Mabini for partnering with us to make this happen. And, of course, to my proven fiscal team for another job well done.” — Governor Eddie Baza Calvo
UOG Tuition Increase Averted; New Funding for Tax Refunds, Mayors
The 1993 General Obligation bonds were just refinanced in New York, averting a tuition increase at the University of Guam, and providing cash for tax refunds and for village CIP projects. The Governor’s fiscal team successfully priced the bonds at extremely favorable rates just an hour ago.
$4.1M in Savings to Taxpayers
$22.6 million in Business Privilege Tax Bonds, Series 2013 C, were sold to refinance the ’93 GO bonds at record low interest rates. On December 30, 2012, Governor Eddie Baza Calvo signed P.L. 31-276 and directed his fiscal team to immediately take this re-financing to market. The Governor’s fiscal team was able to successfully sell the bonds and achieve $2.9 million in debt service savings. Additionally, $1.2 million of bond related cash was freed up and will be released to satisfy provisions of P.L. 31-276.
Interest Rate Lowered
This refinancing lowered the government’s interest rates on its older bonds from 5.40% to 1.69%, without extending the term of the bonds.
Bond Market Remains Confident in GovGuam
The untimely release of a District Court decision in Paeste et al, vs. Government of Guam prior to the sale of bonds made the sale more difficult. But, because of the tremendous amount of pre-marketing and direct investor outreach by GEDA and the Fiscal Team, the bond market remained confident that Guam would meet its obligations to both taxpayers and bondholders and continue to act in a fiscally responsible manner.
End of Release