Just days after receiving AAA ratings from Fitch, S&P, and KBRA, Maryland completed an $800 million general obligation bond sale, securing favorable borrowing rates for future capital projects.
The Board of Public Works approved the sale on Wednesday as part of the State and Local Facilities Loan of 2026. The bonds will help finance school construction, higher ed facilities, environmental projects, public safety improvements, and other infrastructure investments across Maryland.
The sale attracted seven bids for each of the three bond tranches offered, reflecting continued investor demand for Maryland debt despite growing attention to the State’s long-term fiscal outlook.
Morgan Stanley & Co. won two portions of the sale totaling roughly $539 million, while Jefferies LLC won the remaining $261 million tranche. True interest costs ranged from approximately 2.7% to 3.8%. The sale also generated more than $108 million in bond premiums before fees, exceeding the roughly $93 million generated from last year’s sale despite a smaller overall issuance.
Maryland currently holds AAA ratings from Fitch Ratings, S&P Global Ratings, and KBRA, the highest rating available from each agency. Those ratings help borrowers secure lower interest rates, reducing long-term borrowing costs for taxpayers.
For counties, the bond sale represents another step in funding Maryland’s capital program. General obligation bonds remain a primary tool for financing major investments that support local communities, including schools, infrastructure, public safety facilities, and environmental projects. By issuing bonds, the State can spread those costs over time rather than paying for them entirely through annual revenues.
Stay tuned to Conduit Street for more information.
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