Fitch Ratings affirmed Maryland’s AAA bond rating in advance of the upcoming competitive sale of State General Obligation (GO) Bonds. Fitch Ratings assigned a AAA rating to the following GO bonds, state and local facilities loan of 2020, second series:

• $540 million series A, tax-exempt bonds (competitive)
• $155 million series B, tax-exempt current refunding bonds (competitive)
• $375 million series C, taxable advance refunding bonds (competitive)

According to the Fitch Ratings analysis:

Maryland’s ‘AAA’ IDR reflects its broad, diverse and wealthy economy, very strong fiscal management with consensus-oriented long-term planning and multiple sources of flexibility, all of which position the state well to address implications of the ongoing coronavirus pandemic.

Although liabilities are elevated for a state, they are moderate relative to resources and carefully managed. The state’s economy has long benefited from proximity to the nation’s capital, although exposure to federal budget cuts poses a greater uncertainty for Maryland than for most states given its large federal agency presence and associated private contracting.

Maryland is one of thirteen states to hold the coveted AAA rating, the highest possible rating, from all three major bond rating agencies. S&P Global Ratings has rated the bonds AAA since 1961, Moody’s Investors Service has assigned the bonds a rating of Aaa since 1973, and Fitch Ratings has rated the bonds AAA since 1993.

As is always the case with Maryland’s tax-exempt General Obligation Bonds, the State will use the proceeds to finance important capital projects and improvements, such as public schools, community colleges, university projects, and hospitals.

The Maryland Board of Public Works, composed of Governor Lawrence J. Hogan, Jr., Treasurer Nancy K. Kopp, and Comptroller Peter Franchot, will preside over the competitive bond sale on Wednesday, July 22, 2020.

Stay tuned to Conduit Street for more information.