The Nebraska Investment Finance Authority (NIFA) issued $139.3 million in bonds to finance affordable housing programs.
The authority sold the bonds in two series. The tax-exempt 2024 Series A bonds, consisting of $105 million, mature between 2024 and 2054, paying interest at rates between 3.2% and 4.8%. The taxable 2024 Series B bonds, consisting of $34.3 million, mature between 2024 and 2049, bearing interest at rates between 4.729% and 6.25%. The securities received a rating of AAA from S&P Global Ratings.
The bond proceeds will fund the authority’s homebuying program, which is based on the purchase of mortgage-backed securities.
“The ratings reflect our view of the program’s legal framework, program management and operational risk assessment, overcollateralization and cash flows, liquidity, and market-position characteristics,” S&P analyst Dan Pulter said in a press release.
The need for affordable housing in Nebraska has grown in recent years. The state has just 77 affordable and available rental units for every 100 low-income renters, according to the Bipartisan Policy Center, a Washington think tank.
The gap persists despite NIFA efforts to fund affordable housing initiatives. The authority use bonds to finance the purchase of $869 million in home mortgage loans between 2021 and 2023, funding more than 5,000 loans for first-time homebuyers, according to the official statement accompanying the sale of the bonds.
The bonds are limited obligations of the authority, payable by mortgage revenue.
J.P. Morgan Securities LLC served as lead underwriter on the issuance, purchasing the bonds for $140 million. CfX Incorporated acted as municipal advisor.