Featured Municipal Bond in the Market, Week of 06/26/2017: City of Richmond General Obligation (Refunding) Bonds – $227 Million


This week’s featured bond comes from the Commonwealth of Virginia. The City of Richmond is issuing general obligation bonds in the amount of $227 million the week of June 26, 2017. The bonds consist of two series. Series 2017B consists of $183 million in public improvement and refunding bonds, and Series 2017C are $44 million in public improvement refunding bonds. The interest on Series 2017C is considered to be federally-taxable. The purpose of the bonds is to currently refund portions of outstanding previously issued general obligation public improvement bonds, and general obligation line of credit bond anticipation notes, from 2009, 2010, 2012, and 2015.

The bonds are direct and general obligations of the City of Richmond, and are backed by an irrevocable pledge of the City’s full faith and credit. Further details on the purposes, security, tax status, and other matters pertaining to these City of Richmond general obligation bonds can the found in the preliminary official statement, provided by MuniOS.

As of May 2017, the Richmond Metropolitan Statistical Area has an unemployment rate of 3.8%, which is 0.6% lower than the national rate for May, and 0.1% higher than at the same time in 2016. The chart below shows the changes in the Richmond MSA, Commonwealth of Virginia and U.S. unemployment rates for the past ten years. MuniNet provides this data and more, easily accessible, for all 50 states and each Metropolitan Statistical Area in the country, in our Employment Database.

City of Richmond

According to the audited financial statements in Appendix B of the preliminary official statement, total general fund tax revenues in 2016 totaled $473.3 million. The end of year fund balance was $114.4 million, and total expenditures were $625 million, giving end of year fund balance as a percentage of total expenditures of 18.3%. Additionally, the City of Richmond in 2016 had an unrestricted net position for its governmental activities of $(270.8 million).