The hospital received a AA rating from Standard & Poor’s and an A+ rating from Fitch for its General Obligation bonds, Series 2009 in the amount of $17.5 million. The high marks mean the hospital will pay less interest over the life of the bond, which results in a savings for taxpayers. A lower rating would most likely result in the property tax millage of 7 mills, initiated in 2003 and approved for renewal in 2007, to stay in place longer.
Along with the Gulf Opportunity bond classification awarded in May, hospital officials estimate the tax savings amounts to about $4 million. Without that designation the project would have to be financed with taxable bonds instead.
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Both Standard & Poor’s and Fitch have rated municipal bonds since the early part of the 20th century.
Bond ratings serve in much the same way as a credit rating for individuals, as a method of evaluating the possibility of default by a bond issuer. Ratings range from AAA (highly unlikely to default) to D (in default). Under most state laws, institutions that invest other people’s money may not buy bonds rated BB or lower.
The public is invited to the groundbreaking at 8:30 a.m. Aug. 5 at the building site, next to the SMH Founders Building located at 1150 Robert Blvd.
“The community’s support of this project has been overwhelming,” said CEO Bob Hawley. “As promised, we are constructing a first-class cancer center that will provide comprehensive and coordinated care to cancer patients using the funding from these bonds.”
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