St. Paul, MN: Today, the state of Minnesota sold $587.6 million in general obligation bonds. Money generated from the sale will support programs and capital improvements related to such projects as educational facilities, parks, pollution control facilities, transportation, natural resources, and agricultural enterprises as well as bond refunding.

“Money from the bond sale will be used to invest in Minnesota’s future,” said Minnesota Management and Budget Commissioner Jim Schowalter. “Capital investments can be built at low interest rates because of investors’ confidence in Minnesota and our solid track record of responsible fiscal management.”

The four series of general obligation bonds sold today include:

• $251,775,000 General Obligation State Various Purpose Bonds, Series 2022A (3.0 percent interest)
• $220,000,000 General Obligation State Trunk Highway Bonds, Series 2022B (2.9 percent interest)
• $9,200,000 General Obligation Taxable State Various Purpose Bonds, Series 2022C (3.5 percent interest)
• $106,660,000 General Obligation State Various Purpose Refunding Bonds, Series 2022D (2.1 percent interest)

Kutak Rock LLP served as bond counsel on the transaction.

Sound Fiscal Management

Ahead of the sale, Moody’s upgraded its rating for the state of Minnesota from Aa1 to Aaa and both Fitch and S&P Global affirmed their AAA ratings, marking the first time since 2003 that all three rating organizations gave Minnesota the very top bond rating.

When upgrading Minnesota’s rating to Aaa from Aa1, Moody’s issued a statement that reads, “The State of Minnesota…ranks among the strongest US states in high per capita income compared to the cost of living, robust financial reserves, and low leverage and fixed costs. The state has demonstrated improvements in fiscal governance including implementing relatively conservative and timely budgets, building up very high reserves, contributing to pensions at healthy levels that prevent growth in liabilities and refilling its unemployment trust fund after depleting it during the pandemic.” 

In confirming Minnesota’s AAA rating, Fitch stated, “Minnesota's 'AAA' IDR and GO bond ratings reflect the state's solid and broad-based economy, highly educated workforce, expanding population and a revenue structure well-designed to capture economic growth. The ratings also reflect a low long-term liability burden and strong control over revenues and spending that, in conjunction with a sophisticated approach to reserve funding, leaves Minnesota well positioned to manage through economic cycles while maintaining a high level of financial flexibility.” 

In affirming Minnesota’s AAA rating, S&P Global noted Minnesota’s: “Deep and diverse economy, with the Minneapolis-St. Paul metropolitan area, the center of the Upper Midwest economy, anchoring regional economic hubs; History of strong financial results, building its reserve accounts to $3.33 billion (11.4% of 2023 annual revenue) on a budgetary basis; Strong governmental framework, with legislative authority to raise revenues and executive authority to reduce and defer expenditures to maintain budgetary balance; and moderate debt levels, with well-defined debt management guidelines and improved pension-funded levels.”

Contact

Patrick Hogan
Director, Enterprise Communications and Marketing
651-259-3737
patrick.hogan@state.mn.us