Seattle Issuing Most in 3 Years After Losing Sonics: Muni Deals
Seattle, Washington’s most populous city, plans to sell $146 million of top-rated general-obligation debt this week in its biggest sale in three years.
Proceeds will fund projects including replacing the Alaskan Way Seawall, a 7,000-foot (2,100-meter) structure that protects the downtown waterfront from waves coming from Puget Sound and has portions from 1916. Seattle, with $940 million in general obligations, has the top credit grade from Standard & Poor’s.
Last month, a group of National Basketball Association owners rejected a bid to make Seattle the new home of the Sacramento Kings. The decision may curb future liabilities: the city of 621,000 planned to sell as much as $150 million of general obligations to help build an arena, said Michael Van Dyck, director of debt financing.
The limited debt burden “is one of many factors that plays into our high credit rating,” Van Dyck said.
This week’s offer is the biggest for the city since March 2010. The $50 million of unlimited-tax debt was passed by voters in November to fund the seawall. Stadium bonds would be limited-tax general obligations, which only need city council backing.
An investment group including Microsoft Corp. (MSFT) Chief Executive Officer Steve Ballmer agreed this year to buy a majority of the Kings and move them to Seattle, where the SuperSonics played for 41 years. The team, which left for Oklahoma City in 2008, won its only NBA championship in 1979.
Ballmer said in a radio interview last month that the group would discuss possible next steps. NBA Commissioner David Stern has said expanding the 30-team league is unlikely.
“A lot of contingencies need to be met before the city is going to do any financing with regards to the stadium,” Van Dyck said. “Obviously, the investor needs to find a team -- that’s the first threshold.”
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