Alaska Municipal Bond Bank Authority


Welcome

Goals: To assist local governments with the financing of capital projects.

Resource Provided: Direct loans. No set limits. Interest rates depend on the national market for tax exempt bond issues.

Eligibility: Any organized local government in need of capital project financing should contact the Bond Bank.

The Bond Bank was established to assist Alaska municipalities that have difficulty financing capital improvement projects such as schools, water and sewer systems, public buildings, harbors and docks. The Bond Bank is a public corporation, created through the passage of the Alaska Municipal Bond Bank Act (AS 44.85).

Created because smaller communities or infrequent issuers of debt often are at a disadvantage in the financial markets. They may have low bond ratings or, although credit worthy, have not issued bonds or notes, have little outstanding debt, or lack investor familiarity. Because the Bond Bank has received an "Aa2" rating from Moody's and an "AA" rating from Fitch, it is able to borrow money at favorable interest rates.

Generally, the Bond Bank sells its bonds on the national market and utilizes the proceeds of its sales to purchase the bonds of Alaskan municipalities, thereby providing these municipalities with the funds for their capital projects. As municipalities pay principal and interest to the Bond Bank on their debt, the Bond Bank uses these payments to pay its debt to its bondholders.

The Bond Bank is self-supporting. It does not use General Fund monies, and, in fact, returns surplus to the General Fund each year. The Bond Bank has an excellent loan record, with no defaults. The powers of the Bond Bank are vested in the Directors. The membership of the Bond Bank consists of five Directors: the Commissioner of Revenue and the Commissioner of Commerce, Community and Economic Development of the State and three Directors appointed by the Governor. The three serve four-year staggered terms and must be qualified voting residents of the State.

The Directors elect one of their members as chair and one of their members as vice-chair and also elect a secretary and treasurer who need not be Directors. Action may be taken and motions and resolutions adopted by the Bond Bank at any meeting by the affirmative vote of at least three Directors. The Directors appoint an Executive Director to manage the business of the Bond Bank.

The Department of Revenue, Treasury Division provides administrative and management staff to the Bond Bank.

The Bond Bank can be reached as follows:

Alaska Municipal Bond Bank Authorit
Deven Mitchell, Executive Director
P.O. Box 110405
Juneau, AK 99801

Phone: (907) 465-2388

E-Mail: mailto:Deven.Mitchell@alaska.gov