Massachusetts Bonds (Massachusetts Municipal Bonds)

By: EconomyWatch Content   Date: 6 November 2009

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Massachusetts bonds (Massachusetts Municipal Bonds) are issued with the purpose of financing the construction of highways, schools and bridges. Massachusetts municipal bonds or ‘munis’ are very popular with high net worth investors as these bonds offer exemption from federal taxes.

 

Massachusetts Bonds: Commonwealth Bonds

In the 2009 fiscal year, the Commonwealth stepped in the municipal market four times with long-term financings. The initiative was a huge success due to the immense demand generated within retail investors. Commonwealth approves bonds for the following kinds of projects:

  • Transportation improvement
  • Affordable housing
  • Bridges
  • Higher Education (including new buildings, renovation projects and capital improvements in Commonwealth’s public higher education campuses)
  • Energy & Environment (including land, parks and clean energy)
  • Infrastructure improvements
  • Life sciences

 

Massachusetts Bonds (Massachusetts Municipal Bonds): Health and Educational Facilities (HEFA)

The Massachusetts Health and Educational Facilities Authority aims at assisting non-profit organizations to thrive and improve quality of life in the state. HEFA is the largest tax-exempt revenue bonds issuer in the Commonwealth. It is a self-funded authority that provides assistance to various research institutions, colleges and universities, human service providers and hospitals obtain low cost access to tax-exempt financing to fund their projects.

 

HEFA’s energy buying program i.e. PowerOptions® aims at bringing down energy costs and providing bottom-line savings to non-profits.  The authority annually provides over a billion dollars to non-profits for construction and renovation projects, financing equipment and refinancing outstanding debt.

 

The following are some popular Massachusetts municipal bonds:

 

  • Massachusetts St Health And Educational Williams College Series L; Coupon/Interest Rate: 5.000% and Maturity Date: 2036-07-01
  • Nantucket Island Land Bank Massachusetts Series A; Coupon/Interest Rate: 5.500% and Maturity Date: 2011-12-01
  • Boston Massachusetts Series B; Coupon/Interest Rate: 3.250% andMaturity Date:2012-04-01

 

Massachusetts HFA $28MM Housing Bonds 2009 Dwere assigned 'AA-' rating by Fitch. The agency also assigned all outstanding MassHousing housing bonds and the 2009 series D bonds a stable rating outlook. The historically sound performance of these bonds is another factor that boosts investors’ confidence in them. These bonds are issued as a fixed rate mode. As per the cash flow statement 2009, the asset parity position of the program is projected to stay above 109%.

 

 


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