Tempe, Arizona, issued $110.7 million in bonds to finance infrastructure and public safety improvements.
The bonds mature between 2025 and 2044, yielding between 3.22% and 4.25%. They received a rating of AAA from S&P Global Ratings.
“The rating reflects our view of the city’s very strong economic profile, which includes consistent growth in net assessed value and a stable labor pool from Arizona State University,” S&P analyst Kyron Smith said in a press release.
The city, which is home to ASU, will use the bond proceeds to upgrade its water and sewer infrastructure and acquire equipment for its fire and police departments. The city will also spend a small portion of the proceeds, about $6.9 million, to refund bonds that it sold in 2013.
Following the issuance, the city has $218.3 million in general-obligation bond authorization, with $138.1 million of that earmarked for water and wastewater improvements. The city is planning a bond election for November at which it will seek up to $581.5 million in bond authorization, according to the official statement accompanying the sale of the bonds.
The bonds are general obligations of the city, payable by property taxes.
RBC Capital Markets, LLC served as underwriter on the issuance, purchasing the bonds for $119 million. The price reflected a premium of more than $8 million.