The government of Louisville, Kentucky, sold $262.2 million in bonds to make improvements to local hospitals.
The bonds were issued in two series. The Series 2023A bonds consist of $145 million and include serial bonds and two term bonds. The Series 2023B bonds consist of $117 million and mature on October 1, 2047, yielding 3.51%. The securities received a rating of A+ from Fitch Ratings and A from S&P Global Ratings.
Louisville issued the bonds on behalf of Norton Healthcare, Inc, to which the municipal government will loan the bond proceeds. Norton, a nonprofit healthcare provider that manages 40 clinics and hospitals around Louisville, will use the money to invest in improvements to its facilities.
“The ‘A+’ long-term rating reflects Fitch’s view of Norton’s position as the leading acute care provider in its primary service area, its historically strong and consistent operations, and a steadily improving financial profile,” according to Fitch.
Among other projects, the bonds will finance the construction of the Norton West Louisville Hospital, which is slated to open next year. Originally announced in February of last year, the 20-bed hospital will be the first newly built hospital to open in West Louisville in 150 years, according to the official statement accompanying the sale of the bonds.
West Louisville has higher rates of poverty than other parts of the city. It has traditionally been underserved by healthcare services, and its healthcare insurance rates lag behind the rest of the city.
The bonds are limited obligations of Louisville, payable by loan payments from Norton.
J.P. Morgan Securities LLC served as lead underwriter on the issuance.