The Year in Review
During Fiscal Year 2019, the Debt Management Division's noteworthy accomplishments included:
- During Fiscal Year 2019, the Debt Management Division oversaw the State's $25.6 billion debt portfolio and managed the issuance of $2.2 billion of new bonds to fund the State's capital programs, including local school construction, economic development initiatives, transportation infrastructure, improvements at the University of Connecticut, and Clean Water and Drinking Water grants and loans. These projects help to bolster the local economy throughout the State. In addition, the Division issued $400 million of General Obligation bonds to repay maturing bond anticipation notes.
- The Division also issued a total of $435.4 million of refunding bonds across several of the state's bond programs to capture the lower interest rates in the current marketplace thereby providing $51.7 million in debt service savings over the life of the bonds.
- Notable this fiscal year was the Division's role in the General Assembly's adoption of a major proposal advanced by the Governor and Treasurer to restructure the funding of the Teachers' Retirement Fund. The adopted proposal puts funding on a more sustainable path and includes the lowering of the investment return assumption to a more achievable level. This was accomplished by creating a Special Capital Reserve Fund, using current year budget surplus, to provide adequate provision for the outstanding 2008 pension obligation bonds.
- In addition, the General Assembly passed a Joint Resolution confirming its intention in the prior regular legislative session to exclude refunding bonds and certain other bonds from the new General Obligation bond issuance caps, reaffirming the Attorney General's opinion on the matter.
- In March 2019, Governor Lamont, Treasurer Wooden, and the Office of Policy and Management's Secretary McCaw personally met with major bond investors through an extensive and highly successful Investor Road Show lunch tour conducted in four cities. The new Administration shared their vision and plans for Connecticut.
- Both S&P Global Ratings and Kroll Bond Ratings elevated their credit outlooks on Connecticut's General Obligation bonds to positive and stable, respectively, the first rating upgrade or positive outlook of General Obligation bonds in 18 years. These improved outlook changes, together with the Administration's outreach to investors, led to some record high levels of investor demand in a market already buoyed by federal tax reform, resulting in much improved pricing across the State's bonding programs.
- Continuing its market leadership, Connecticut priced its sixth issue of Green Bonds, this time for the State Revolving Fund for Clean Water and Drinking Water Projects which generated $57 million in bond orders from Green investors.