General Obligation Bonds (“GO”) are Connecticut’s primary bonding program. The full faith and credit of the State are pledged for payment of principal and interest.
GO bonds are used to finance school construction grants; the construction of buildings; grants and loans for housing; economic development; community care facilities; state parks; and open space. Roughly half of the bonding is for school construction.
The GO program has also issued pension obligation bonds for the Teachers’ Retirement Fund, GAAP Conversion bonds and Economic Recovery Notes.
The UConn 2000 program finances infrastructure improvements for the University of Connecticut; its campuses; and the UConn Health Center.
The bonds are general obligations of the University and are additionally secured by the State’s commitment to pay the debt service on the bonds. Up to $4.3 billion of bonds will be issued under a 28-year capital program to rebuild and refurbish the University.
Special Tax Obligation (“STO”) bonds are issued for the State’s portion of transportation infrastructure improvements, including highway and bridge construction and maintenance, mass transportation and transit facilities, waterway facilities, and DOT maintenance and administrative facilities.
Debt service on STO bonds is repaid from the dedicated revenue stream of the Special Transportation Fund including the motor fuels tax, oil companies taxes, a portion of the general retail sales taxes, motor vehicle receipts, licenses, permits and fees, sales tax collected on casual motor vehicle sales, and other transportation related revenues.
The SRF Program includes the Clean Water State Revolving Fund (CWSRF) and the Drinking Water State Revolving Fund (DWSRF). The CWSRF was established in 1986 and the DWSRF was implemented in 1996. Federal capitalization grant funds are provided for both the CWSRF and DWSRF. To expand the capacity of the SRF Program, the State chose to leverage the federal capitalization grants by issuing revenue bonds. The State has designated certain of its SRF bonds as Green Bonds, to be used solely to fund Green Projects. The State engaged an Environmental Social and Governance (ESG) firm to provide a second opinion on the framework of the SRF Program and the environmental integrity of the projects eligible for Green Bond designation. The ESG firm found that the SRF Program follows the guidance provided by the Green Bond Principles and is in alignment with its core components. For more information on Green Bond Principles click on the link below:
The CWSRF partners with local governments to build and finance projects that improve water quality and protect public health while sustaining the State’s significant natural resources, including 450,000 acres of wetlands, 6,000 miles of streams and rivers, over 2,000 lakes and reservoirs, and 600 square miles of estuarine water in the Long Island Sound.
The DWSRF ensures that the State’s public water sources and systems maintain safe, adequate, and sustainable drinking water for residents and visitors of the State, by making available, to the over 2,000 public water systems, low-cost financial assistance to fund various water infrastructure improvement projects.
Questions related to the SRF Program:
What is a Green Bond?
A Green Bond is a financial instrument utilized to finance projects that have climate or environmental benefits. Green Bond proceeds are applied solely to finance eligible Green Projects. Green Projects fall into several broad categories, including water pollution prevention and control, and sustainable water management.
Why does the SRF Program issue Green Bonds?
The SRF Program issues Green Bonds to emphasize and encourage its commitment to the use of bond proceeds in accordance with Green Bond Principals. Borrowers who receive assistance from the SRF Program finance Green Projects including infrastructure improvement projects for waste water treatment systems and public drinking water systems.
How secure are State of Connecticut SRF bonds?
Bonds issued through the SRF Program are currently rated Aaa, AAA and AAA by Moody’s Investors Service, S&P Global Ratings and Fitch Investors Service, respectively, each rating agency’s highest rating designation. The SRF Program has a highly rated and diverse borrower pool. The credit of the borrowers is continuously monitored. SRF bonds are cross-collateralized so all available moneys in the SRF are available to pay debt service on SRF bonds. In addition, the Program is structured such that SRF funds cannot be used for any purpose other than the SRF Program.
Who benefits from the projects funded through the SRF Program?
The goal is to ensure that every resident of, and visitor to, the State of Connecticut has access to clean safe drinking water and pollutant free waterways.
Why consider buying SRF bonds?
Investing in Connecticut SRF bonds contributes to the continued growth of the SRF Program. This means more funding is available to finance additional projects to continually improve upon the State’s water infrastructure and the safety of its waterways.
Various state authorities issue their own debt. Please contact them directly.
10 Columbus Boulevard
Hartford, CT, 06106-1976
10 Columbus Boulevard
Hartford, CT, 06106-1976