It's good news that's becoming a habit.
Once again, the nation's top financial rating agencies have awarded Utah a AAA bond rating, meaning the money the state can borrow for new buildings at the lowest interest rate possible. And that means considerable savings to Utah taxpayers.
"We're looking at selling the bonds somewhere in the high 4-percent range," said state Treasurer Edward T. Alter.
The AAA rating is the highest of all bond ratings and is cautiously given to only the most credit-worthy borrowers in the nation, Alter said.
The rating was awarded by Moody's Investors Service, Standard and Poor's Rating Group and Fitch Investors Service in anticipation of the state selling $20 million in general obligation bonds on Thursday. The money will be used to expand the Utah State Prison in Gunnison, to design a 200-bed forensic hospital for the Department of Corrections and for improvements to several existing state buildings.
Alter and Utah Gov. Mike Leavitt flew to New York to meet personally with officials of the rating services, who were interested in how the state intends to fund at least $1 billion in highway improvements over the next few years.
"They were aware of the state's needs and they wanted to see our plans for that. And they wanted to know how we were going to pay for it," Alter said.
The rating services were pleased with the state's plan to use a combination of ongoing revenue and bonds. In fact, Moody's wrote, "If we were to survey all 50,000 ratings we have outstanding, we would be hard-pressed to find a stronger credit than yours is right now."
Fitch officials added, "The high quality of Utah's general-obligation credit standing directly reflects the small amount, very short tenure and modest burden of its debt."
Given the $20 million total bond package - small by bond standards - Alter said it is possible they will be sold to a single investor. The State Bonding Commission is expected to receive at least 14 bids, and the competition for the bonds is expected to drive the interest paid on the bonds to under 5 percent.
"There's a lot of interest on Wall Street (in the Utah bond package)," Alter said, adding that a key reason is confidence in the state's continued strong economy and the rate of job growth. "We have consistently demonstrated that Utah is trustworthy in its borrowing habits and is prudent in its debt-management planning."
The state plans to sell another $11 million in general obligation bonds in 1997.
Utah is one of only five states with an AAA bond rating from all three agencies.