The Smith County Communications Office strives to promote transparency by providing the public with the most accurate, accessible and up-to-date information possible while promoting the county's brand and message of "Striving for Excellence."
Located on the first floor of the Smith County Annex Building
200 E. Ferguson, Suite 100
Tyler, Texas 75702
Email: Casey Murphy
Commissioners Sale Road Bonds at Historic Rate
The Smith County Commissioners Court on Tuesday, June 23, voted to approve the sale of the third tranche of voter-approved road bonds at an historically low interest rate after receiving seven competitive bids.
On Monday, June 22, Specialized Public Finance Inc. bid general obligation bonds, which will net the county $7.75 million towards the third year of the first phase of the three-year bond package.
Smith County received seven bids on the bonds, with Huntington Securities, Inc. submitting the winning bid at a true interest cost of 0.959 percent.
“It is unheard of to be able to sell bonds at such a low interest rate,” Smith County Judge Nathaniel Moran said. “This will greatly reduce interest associated with the bond debt, which was already low because of the short 10-year term of the bonds.”
The bonds are rated AA+ by Standard & Poor’s Rating Services, which is equivalent to that of the United States federal government.
“No doubt, the County’s bond rating, which is a reflection of the strength of its financial position and conservative approach to budgeting, played a major role in selling the bonds at such a low interest rate,” Judge Moran said.
In November 2017, Smith County voters approved a $39.5 million bond package to improve county roads. There remains $7.75 million in bond money that has not yet been sold. At the request of the Court, Steven Adams, managing director of Specialized Public Finance Inc., said he would look into the advisability of selling the remaining $7.75 million in bonds and whether doing so now would save additional taxpayer money long-term because of the current low interest rate.
Adams gave a brief presentation to the Commissioners Court, and reaffirmed that Smith County’s very high rating of AA+ helps the interest rates on the 10-year maturity bonds. He said because of the low interest rate, the numbers will remain within the tax rate told to voters during the bond election.
“We were very happy to see the interest rate on the bonds come in at under 1 percent,” Adams said. “This rate is much lower than we projected when the election was called and will help the County lower its debt payments significantly. This low rate is attributable to the current interest rate environment and the County’s strong financial management.”
“I have never seen anyone come in at less than 1 percent interest rate,” Commissioner Terry Phillips said.
The money received from this bond sale will fund continued Road and Bridge Department construction projects in accordance with the County’s six-year Road and Bridge Bond Program.
Under the direction of County Engineer Frank Davis, the County has been steadily working to complete the planned projects over the past few years. In the first two years of the bond program, about 100 miles of roadway have been reconstructed or completely overlaid under this program.