The Bonds were rated “A” by S&P, given the strength and stability of the pledged sales tax revenues
Proceeds from the Bonds will be loaned to the City of Jackson, Mississippi (the “City”) and used for City infrastructure improvements, including road/street improvements as well as water/sewer and drainage projects. The Bonds are limited obligations of the Mississippi Development Bank (the “Bank”), primarily secured by a loan agreement between the Bank and the City, along with an associated promissory note and payments thereunder.
Payments on the note are payable from revenues generated by a 1% special sales tax authorized to fund City infrastructure needs and levied on businesses and services within the City already taxed at the general sales tax rate. The Bonds are further secured by a debt service reserve fund and a tax intercept agreement between the City and the Bank which authorizes the Bank, in the case of payment delinquency, to intercept certain funds due to the City from relevant State agencies.
SWS developed an investor presentation to educate investors on the strong credit of the City. The investor presentation received a total of 35 views, of which 18 were from investors; 9 of those investors ultimately placed orders on the transaction. As a result of SWS’ extensive pre-marketing and sales efforts, the transaction garnered $245 million in total orders from 15 different institutional investors resulting in an aggregate oversubscription of 7.0x and 5.2x to 9.4x based on priority orders. At repricing, SWS’ desk recommended lowering yields across all maturities including 12 bps in both 2021 and 2022, 10 bps in both 2023 and 2024, and 8 bps in all remaining maturities from 2025 through 2030.