SCHOOL BONDS REMARKETED
Trenton, N.J. (April 2, 2008) – The Office of Public Finance has announced that the New Jersey Economic Development Authority today remarketed $617 million School Facilities Construction Bonds, Sub-series 2004 J4 and J5; 2005 Sub-series Q1 and Q2, and 2007 Sub-series T1, T3, T5 and T7, as the initial financing to restructure the Authority’s outstanding auction rate bonds.
The $617 million in bonds were all originally insured by FSA at the time of the bonds’ original issuance, remain insured by FSA and are rated Aaa/AAA/AAA by Moodys, S&P, and Fitch, respectively. The bonds were structured as $236.5 million fixed rate serial bonds and $380.5 million bonds subject to tender in 2014 and 2015. On the tender dates in 2014 and 2015 the Authority will determine what interest rate mode the bonds will then be converted to. The mode options include variable rate, term rate or fixed rate to maturity.
The remarketed bonds incurred a true interest cost of 4.11% through and including the tender date. This compares favorably to auction rates that have been incurred on these sub-series which ranged from 4.34% to 10.9% since early February, when some auctions began to fail.