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Wisconsin Sells More Than $270 Mln in Bonds

By Munichain News Desk

Wisconsin sold $271 million in bonds to make general capital improvements.

The bonds mature between 2025 and 2044, yielding between 2.79% and 3.71%. They pay interest at 5%. The securities received a rating of Aa1 from Moody’s Investors Service, AA+ from S&P Global Ratings, and AAA from Kroll Bond Rating Agency.

“The Aa1 issuer rating reflects the State of Wisconsin’s well-funded pension system and limited OPEB liability, conservatively managed budgets, large economy with solid resident incomes, and strong reserves and liquidity even after projected draws through fiscal 2025 for one-time spending,” Moody’s analysts wrote, referring to other post-employment benefits.

The issuance comes a month after Wisconsin Governor Tony Evers signed the state’s 2023-25 biennial budget. The $99 billion budget includes tax cuts and raises for state employees.

The budget made national headlines after Evers controversially tweaked its language to ensure higher funding for education for the next four hundred years. Wisconsin allows governors to strike words in certain sections of the budget, a power which allowed Evers to change the phrase describing the duration of the boost in education funding from “for the 2023-24 school year and the 2024-25 school year” to “for 2023-2425.”

The state will use the proceeds from the bonds to fund a series of improvements. These include the “acquisition, construction, development, extension, enlargement, or improvement of land, water, property, highways, buildings, equipment, or facilities for public purposes,” according to the official statement accompanying the sale of the bonds.

The bonds are general obligations of the state, backed by its full faith and credit.

Morgan Stanley & Co LLC served as lead underwriter on the issuance, purchasing the bonds for $302 million. The price reflected a premium of $31 million.

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