North Carolina approves nearly $1 billion of financings

BY SourceMedia | CORPORATE | 01/08/25 05:01 PM EST By Robert Slavin

The North Carolina Local Government Commission approved several bond deals at its meeting Tuesday.

Approved were $252 million, $90 million and $45 million of bonds for Mecklenburg County, a $200 million bond for the city of Durham, and a $130 million bond anticipation note for Piedmont Triad Regional Water Authority.

Mecklenburg County plans to use proceeds of the $252 million limited obligation bonds, with a 20-year term, to build or renovate several municipal facilities.

The county's $90 million general obligation bond proceeds will be used to refund its Series 2013B and 2015A bonds. No tax increase will be necessary. The bonds will have a 10-year term.

The proceeds of the $45 million GOs with a 20-year term will be used to improve, acquire and upgrade solid waste facilities. The county plans to sell the bond competitively on or around January 22.

There will be no tax increase associated with these bonds.

For Mecklenburg's bonds, Fort Tryon Advisors is the municipal advisor and Parker Poe Adams & Bernstein is the bond counsel.

Durham's $200 million GOs will mature in no more than 20 years and will be sold by competitive bid.

The city plans to use $115 million for streets and sidewalks. The remaining $85 million will be used for parks and recreation facilities.

The bonds would add 3.46 cents per $100 of assessed property value, with the rate declining over 20 years.

The commission approved the Piedmont Triad Regional Water Authority's request to sell $130 million in bond anticipation notes, maturing April 1, 2027, for water treatment plant expansion to Truist Commercial Equity in a private placement. First Tryon is the municipal advisor and Robinson, Bradshaw & Hinson is the bond counsel.

Supporting the BANs and planned bond will be a 6.5% increase in water rates from 2026 to 2028 and a 4% increase thereafter.

Separately, State Treasurer Brad Briner announced he was appointing four members to the state's Investment Advisory Committee. When he ran for office Briner criticized State Treasurer Dale Folwell for excessively conservative investment of the pension monies.

The new members are Robert Durden, chief executive officer and chief investment officer at the University of Virginia Investment Management Company; Michael Kennedy, former senior client partner with Korn Ferry (KFY); Jamey Spencer, managing director and shareholder at Pathstone; and Dan Ward, chief investment officer at Greenhawk Family Office.

"North Carolina's pensions realized almost 1.4% lower annual performance than the average pension in the United States over the last 10 years," Briner said. "North Carolina deserves better and this group of professionals will help ensure that we are maximizing returns at an appropriate level of risk."

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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