BOSTON - State Treasurer Tim Cahill, Chairman of the Board of Directors of the Massachusetts School Building Authority (“MSBA”), and MSBA Executive Director Katherine Craven, today announced the results of the sale of the Massachusetts School Building Authority’s Qualified School Construction Bonds. The MSBA sold $151 million of taxable Qualified School Construction Bonds (QSCBs) at a yield almost half a percentage point below Build America Bonds. Proceeds from the sale will be used to fund capital construction and improvement projects across the Commonwealth.
QSCBs are part of the American Recovery and Reinvestment Act of 2009 and come with a 100% federal subsidy. The school issue, the third-largest of such securities this year, will mature in 2027, and are backed by a dedicated one percent state sales tax. Past school building authority bond deals include a $2.5 billion issuance in 2005, a $1.5 billion issuance in 2007 and a $600 million in December 2009. Proceeds from these deals were used to fund much needed school building and repair projects.
"The MSBA will be able to immediately spread limited resources to more districts across the Commonwealth with the proceeds from this bond deal,” said Treasurer Tim Cahill.
“It’s a very unique product,” said Katherine Craven, Executive Director of the Massachusetts School Building Authority. “Coupled with the MSBA’s good reputation and credit, the deal was received very well.”
The MSBA is collaborating with municipalities to equitably invest up to $2.5 billion in schools across the Commonwealth by finding the right-sized, most fiscally responsible and educationally appropriate solutions to create safe and sound learning environments. The MSBA is committed to protecting the taxpayer’s dollar by improving the school building grant process and avoiding the mistakes of the past in the funding and construction of school facilities.
In 2007, as a result of programmatic reforms and sound fiscal management, the MSBA was able to reopen a sustainable, reformed grant program. In its five year history, the MSBA has made over $7 billion in reimbursements to cities, towns and regional school districts for school construction projects. These timely payments have saved municipalities over $2.9 billion in avoided local interest costs and have provided much needed cash flow to communities in these difficult economic times.