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Pennsylvania Issues $195 Mln in Parking Bonds

By Munichain News Desk

The Pennsylvania Economic Development Finance Authority (PEDFA) sold $194.9 million in bonds to refund previously issued securities.

The authority issued the bonds in three series. The 2024 Series A bonds, consisting of $96.3 million, mature between 2025 and 2044, yielding between 3.39% and 4.32%. The 2024 Series B bonds, consisting of $65.8 million, mature between 2039 and 2053, yielding between 3.71% and 4.56%. The 2024 Series C bonds, consisting of $32.8 million, mature between 2025 and 2033, yielding between 3.47% and 3.83%. 

The securities received an insured rating of AA from S&P Global Ratings and A1 from Moody’s Investors Service, which assigned an underlying rating of A3.

The bonds “will provide operating cash flow relief for the authority to eventually reimburse a debt service reserve fund surety provider,” S&P analyst Scott Shad said in a press release. In the same release, S&P warned that the authority is “at risk of a payment default on all of its financial obligations.” 

PEDFA owes millions to the bond insurer Assured Guaranty Municipal Corp. (AGM) for making early draws on its debt service reserves. The authority also engaged AGM to insure the series 2024 issuance.

Proceeds from the issuance will refund bonds that the authority sold to build parking in a central Pennsylvania county in 2013. PEDFA drew $4 million from its debt service reserves for the 2013 bonds in 2021 and 2022.

The bonds are limited obligations of the authority, payable by its revenue.

RBC Capital Markets LLC served as lead underwriter on the issuance, purchasing the bonds for $196.4 million. The price reflected a premium of $2.9 million and a discount of $1.4 million. PFM Financial Advisors LLC acted as municipal advisor.

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