Virginia Beach Refinancing Saves Taxpayers $4.2 Million Over 14 Years

City Earns Perfect AAA Ratings for Seventh Straight Year

Tuesday, February 09, 2016
​The City of Virginia Beach has saved taxpayers $4.2 million by refinancing some of its bonds – loans that fund major construction projects like school renovations and road widenings. The city’s outstanding AAA bond ratings helped make the savings possible. The savings will free up money to pay for day-to-day services like police officers, firefighters, teachers, parks and libraries.   This is the seventh year in a row that Virginia Beach has earned AAA bond ratings from all three major rating agencies. No other city in Hampton Roads has perfect bond ratings.   Today, the city closed on $61 million in new general obligation bonds at the very low rate of 2.438 percent -- the lowest rate the city has ever received on a large, new-money bond issue. The money will be used for 22 construction projects, including the new Kempsville Recreation Center, the new Kemps Landing/Old Donation school replacement, renovations to John B. Dey Elementary School, replacing the Lesner Bridge, improving the intersection of Indian River Road and Kempsville Road, and the new Blackwater Fire and Rescue Station.   The city also issued $50 million of refunding bonds at the even-lower rate of 1.772 percent. As a result, the city will save $4.2 million in debt payments over the next 14 years.   “We never take for granted our perfect AAA bond ratings,” said Mayor William D. Sessoms, Jr. “We work hard to be good caretakers of our citizens’ money.”   City Finance Director Patricia A. Phillips added, “We know Wall Street re-examines us every year to make sure we continue to be fiscally conservative. It’s hard to achieve AAA ratings from all three bond agencies, and even harder to maintain those ratings.”   All three agencies praised Virginia Beach’s outstanding policies:   • Fitch praised Virginia Beach’s “conservative budgeting practices” and “maintenance of very sound reserves.” • Moody’s noted that Virginia Beach “has demonstrated resilience through the recession” and the city has a “history of strong financial management.”• Standard and Poor’s highlighted Virginia Beach’s “very strong economy,” its “very strong management” and “very strong debt and contingent liability position.”   # # #