Release Date: September 7, 2016
Susan Simmons , Director of Finance, 843-341-4645
The Town of Hilton Head Island issued $27.885 million GO Refunding Bonds on September 1, 2016 to achieve savings through lower interest rates. The new bonds replaced 2005, 2008 and 2010 bonds totaling $28.440 million. The Town will realize $3,000,322 in savings over the life of the bonds.
Recently, the Town underwent a rigorous bond ratings process; all three municipal bond rating agencies affirmed the Town's strong ratings citing strong financial practices leading to ample financial reserves and high liquidity as well as a very strong economy.
Standard & Poor's: Aa+
The Town’s history of financial responsibility was central to the strong ratings.
Town Manager Stephen G. Riley stated, "The new bonds save over $3 million. The favorable ratings' reports were integral in driving demand for the bonds; the Town was able to lock-in very favorable rates to achieve these savings."
The savings from refunding the three bond issues will be used to repay the new bonds faster. The Town is funding an aggressive Capital Improvements Plan (CIP) fund without increasing millage rates for the Debt Service Fund. Residents and tourists will benefit from new projects without a tax increase.
Finance Director Susan Simmons stated, "Our directive has been clear -- find savings where we can.This transaction was the result of our efforts to find savings on the Town's behalf and take advantage of the current favorable markets."
The Town plans to issue $25 million Bond Anticipation Notes (BAN) on September 21, 2016 for new projects in its approved CIP. The Town anticipates issuing permanent financing in about a year with GO Bonds as well as Beach Preservation Fee and Tax Increment Financing Special Revenue Bonds. The CIP includes expansion of the Island Recreation Center, Island-wide Beach Renourishment, Coligny/Pope Initiative Area Improvements, and a number of other items specified in the Town’s Fiscal Year 2017 Budget.
If you would like additional information about the Town's bond profile, ratings, and debt management policies, you may read more in the CAFR or Budget on the Town’s website at www.hiltonheadislandsc.gov or contact Susan Simmons at SusanS@hiltonheadislandsc.gov or (843) 341-4645.