Nearly $300 million in construction projects around the state will be funded through premium revenues from the state’s recent $1.25 billion bond sales, Gov. Kay Ivey announced Thursday.
The money will be dedicated to 20 projects.
“The announcement today marks a significant investment in the future of this state,” Ivey said in a written statement. “I’m grateful to the Alabama Legislature for the enabling legislation which established the (Public School and College Authority) and the astute work of State Finance Director Kelly Butler for positioning the bond sale in the best way possible.”
The $1.25 billion bond issuance was approved last month by the Alabama Public School and College Authority. However, thanks to the interest rate secured by Ivey and the Department of Finance, the state will now see an extra $298 million that will go toward additional projects.
“Because of the low interest rate in the market, these extra funds were created,” Sen. Arthur Orr, R-Decatur, said. Orr sponsored the 2020 legislation that allowed for the bond sale. “Gov. Ivey has made strategic decisions that will benefit the state significantly in the decades ahead.”
The true interest cost of the bonds is 2.145% over the 20-year repayment period, Ivey’s office said Thursday.
Unlike the $1.25 billion that is flowing to school systems and colleges and universities, this $298 million was earmarked for specific construction projects, related to education and workforce development.
Lawmakers didn’t have a say in the distribution of premium money; that was the authority. But Rep. Bill Poole, R-Tuscaloosa, said the project list is “a good investment in the future of our state in multiple areas of our state and in multiple education sectors.”
“The PSCA bond is intended to invest in education and invest in economic development opportunities that spin off of education and improve the lives of Alabamians both now and in the future,” Poole said.