Treasurer also announces successful $150M Historic Tax Credit bond sale

PROVIDENCE, RI 6/12/2009 - General Treasurer Frank T. Caprio announced today that Moody's Investors Service, Standard and Poor's (S&P) and Fitch Ratings have all affirmed the State of Rhode Island's credit rating.

"Despite the difficult economic times facing our state, the major credit ratings services have decided to keep our current credit rating intact, " said Treasurer Caprio. "It's an important decision as it affects the ability of the State to borrow money and sell bonds in the future. It is very good news for Rhode Island, " Caprio said.

Yesterday, the State successfully issued $150 million in historic structures tax credit financing program series 2009A bonds (federally taxable). The bonds, which have a final maturity in 2018, were sold with JP Morgan and Citbank as lead underwriters.

The bonds that mature in 2010 yielded 1.6%, while the bonds that mature in 2018 yielded a return of 6.17%.

The bonds are the first to be issued to reimburse the state for tax credit claims under the historic structures tax credit program that was launched in 2002.

As part of the budget closing measures for the fiscal 2009 budget, the state legislature unanimously approved up to $356.2 million in Rhode Island Economic Development Corporation (RIEDC) bonds to fund tax credit claims, which had been substantially reducing state revenues in recent years. At the same time, a moratorium on new projects was put into place.

The current offering is expected to fund $60.8 million in claims in fiscal 2009 as well as claims in fiscal 2010 and, if proceeds remain, fiscal 2011.

Ratings overview:

Standard and Poor's (S&P) has affirmed the State's AA rating with a negative outlook and assigned an AA- rating with a negative outlook to both the Certificates of Participation and the Historic Tax Credit bonds.

Moody's Investors Service has also affirmed the State's Aa3 rating and assigned an A1 rating to both the Historic Tax Credit bond sale and Certificates of Participation.

Fitch Ratings has affirmed the State of Rhode Island's rating at AA- with negative outlook, while assigning an A+ rating to the Rhode Island Economic Development Corporation (RIEDC) $150 million revenue bonds and the Certificates of Participation.

Next week, Rhode Island plans to sell $52M in tax-free bonds through Lease Participation Certificates.

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