Canton Township experienced a “very favorable” bond sale last month, officials said.
According to Wendy Trumbull, township finance and budget director, there were six bidders on the municipal bonds, which were ultimately awarded to UBS. While the interest rate on the bonds ranges between 3-5 percent, the Canton bonds were sold at a premium, meaning that Canton received $2.3 million in cash.
This essentially lowers the net interest rate to 1.17 percent per year, Trumbull explained.
The bonds were issued to pay for the Canton five-year capital improvement plan, which includes improvements to municipal facilities and infrastructure that have been deferred for the last 10 years. The sale was helped, Trumbull noted, by the affirmation by Standard & Poor's affirmation of the previous bond rating of AA, with an outlook of “stable.”
The rating was based on factors including “the swift financial reaction to the COVID pandemic as well as the ability of the township to raise revenue if needed,” Trumbull added in a prepared statement.
