The Alaska Municipal Bond Bank issued $35 million in bonds to finance port and upland improvement in a city in the state’s southeast.
The bonds mature between 2024 and 2053, yielding between 3.7% and 4.95%. They received a rating of A1 from Moody’s Investors Service, A+ from S&P Global Ratings, and AA- from Kroll Bond Rating Agency.
“The A1 rating is supported by the State of Alaska’s commitment to ensure payment by replenishing a debt service reserve fund,” Moody’s analysts wrote.
The bank will lend the bond proceeds to a governmental unit to fund infrastructure improvements in Skagway Borough, a city of 1,000 people in southeast Alaska. The bonds will fund improvements that allow Skagway to receive larger cruise ships and accommodate increasing demand for ore, a major Alaskan export. The municipality plans to build a new floating cruise ship dock, relocate fuel lines and a fuel storage tank, construct an industrial transfer bridge, and make related improvements to nearby land.
Skagway port is already a major export destination for Alaskan copper and gold ore, especially to the neighboring Yukon territory in Canada. It is also a stop for many major cruise lines.
The bonds are general obligations of the bank, backed by its full faith and credit.
RBC Capital Markets, LLC served as underwriter on the issuance, purchasing the bonds for $36.6 million. The price reflected a premium of $1.6 million. PFM Financial Advisors LLC served as municipal advisor.