Connecticut issued $1.22 billion in bonds to finance transportation infrastructure projects.
The state sold the bonds in two series. The 2023 Series A bonds, consisting of $875 million, mature between 2024 and 2044, yielding between 3.67% and 4.71%. The 2023 Series B bonds, consisting of $349 million, mature between 2025 and 2034, yielding between 3.67% and 3.89%. The securities received a rating of Aa3 from Moody’s Investors Service, AA from S&P Global Ratings, AA- from Fitch Ratings, and AAA from Kroll Bond Rating Agency.
The rating reflects “superior resiliency of the financing structure, the state’s active management of STF revenues, and otherwise slow underlying growth prospects for transportation revenues, similar to other states,” Fitch analysts wrote, referring to the state’s Special Transportation Fund.
The issuance comes weeks after the state approved the largest transportation infrastructure investment in its history. Earlier this month, Connecticut submitted more than $1 billion in bond funding for transportation projects. Governor Ned Lamont said the move would unlock an additional $2.5 billion in federal funding. Almost two-thirds of the money will be focused on public transit.
The approval marked the latest step toward funding a broad infrastructure agenda. The state is planning to invest more than $10 billion in transportation infrastructure over the next five years. It will fund more than half of the expense with bonds, while federal funding is expected to cover most of the rest of the costs, according to the official statement accompanying the sale of the bonds.
Connecticut’s Special Transportation Fund collects taxes, fees, and revenues to spend on infrastructure improvements. The bonds are special obligations of the state, payable by a pledge on gas and other taxes.
RBC Capital Markets LLC served as lead underwriter on the issuance.