In the current interest rate environment, is this a bad time to be issuing bonds?

Answer

While bond rates are off of their unprecedented lows during the COVID pandemic, they are still below historical averages.

The Bond Buyer General Obligation Bond Index reflects the general interest rate environment for the bonds MPCSD would issue. As shown in the following charts, the index currently has a yield below 4%. MPCSD would likely achieve even lower rates than the index due to its AAA ratings.

At current yield levels, the far more important financial consideration for saving taxpayer dollars is that, by acting now, the District can qualify for over $28 million in government matching funds and energy grants that may not be available at a later date.

Furthermore, the District has consistently taken advantage of lower interest rate environments by refinancing existing bonds. These refinancings of older bonds have already saved local taxpayers over $25 million, and the District is committed to continue doing so in the future, should the opportunity arise.

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