Virginia Bonds (Virginia Municipal Bonds)

By: EconomyWatch Content   Date: 3 November 2009

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According to the Joint Legislative Audit and Review Commission (JLARC) report published in January 2008, Virginia municipal bonds held an AAA rating by Moody's, Standard and Poor's and Fitch. Virginia shared this bond rating with six other states, namely Delaware, Georgia, Maryland, Missouri, North Carolina and Utah. As on June 2009, the state had held this bond rating for the past 70 years. Thus, Virginia bonds are considered to be good performers and highly safe.

Virginia Bonds: What Does an AAA Rating Reflect?

The AAA rating of Virginia bonds is reflective of:

  • Virginia’s ability to save millions of taxpayer dollars in interest payments when it finances debt, such as borrowing for construction costs. With less interest to pay, Virginia can use its resources where they are needed the most and can maintain its favorable tax rates for citizens and industries.

  • Virginia’s excellent financial and administrative status. Virginia gained this status from finance professionals, such as Standard and Poor's and Fitch, who reached this conclusion after rigorously examining the state's fiscal management practices over a period of time.

  • The confidence placed in the Commonwealth's fiscal health.

Virginia Bonds: Issuers

The various types of issuers of Virginia bonds are:

Virginia State General Obligations bonds: These bonds are issued by authorities such as:

  • Schools

  • College/Universities

  • Airports

  • Roads/Highways Authorities

  • Water/Sewer/Power Authorities

  • Housing Authorities 

Popular Virginia Bonds

Some of the popular Virginia bonds are:

  • Richmond Virginia Public Utility Revenue bond: Standard & Poor’s upgraded Richmond city’s already high utility revenue bond rating from AA- to AA on March 31, 2009. The improved rating was based on the belief of Standard & Poor’s that the city’s financial planning will yield positive results in the forthcoming years.

  • Virginia St Resources Authority: These $174.2 million clean water state revolving fund (CWSRF) revenue bonds, subordinate series 2009 were issued to provide loans at below-market rates to 11 local governments for wastewater quality improvement projects in Virginia. Fitch Ratings assigned an AAA rating to these bonds in March 2009 based on sufficient coverage from multiple security layers, strong management of the CWSRF program and ample protection against excessive leveraging.

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