The city of Watertown, Massachusetts issued more than $80 million in bonds to make improvements to its schools.
The bonds mature between 2024 and 2043, yielding between 2.49% and 3.9%. The issuance also included two term bonds: the first matures on June 15, 2048 and yields 4.07%, and the second matures on June 15, 2053 and yields 4.12%. The securities received a rating of AAA from S&P Global Ratings.
“Massachusetts municipalities maintained generally stable credit quality through the pandemic and recession. S&P Global Ratings expects continued stability in the near term, despite macro-level economic pressures,” according to S&P.
The issuance reflects Massachusetts’ longstanding budgetary commitment to education. The state passed legislation in 1993 that imposes education spending requirements on Massachusetts municipalities.
Most of the issuance—$50 million—will go toward constructing a new high school. An additional $24 million will go toward improvements at Watertown’s elementary schools. The remainder of the issuance will go toward infrastructure improvements, including to the city’s sidewalks and sanitation program.
In fiscal year 2021, the city began construction on two new elementary schools, funded by an issuance of almost $100 million in bonds. The city has authorized up to $198 million in bonds for the construction of the new high school.
Watertown is a wealthy Boston suburb located just west of Cambrdige. The bonds constitute general obligations on the city, backed by its full faith and credit.
Fifth Third Securities, Inc served as underwriter on the issuance.