Chicago Sales Tax Securitization Corporation Revenue Bonds

We are pleased to offer Fidelity investors the opportunity to participate in the Chicago Sales Tax Securitization Corporation’s upcoming $156 million offering.

The Chicago Sales Tax Securitization Corporation ("the Corporation") is expected to come to market with $103 million1 Tax-Exempt and $53 million1 Taxable Sales Tax Securitization Bonds.

The bond sale is comprised of a tax-exempt and a taxable series of fixed-rate Sales Tax Securitization Corporation Revenue Bonds; Tax-Exempt Series 2023A and Taxable Series 2023B. The Corporation is a special purpose, bankruptcy-remote not-for-profit corporation incorporated under the General Not For Profit Corporation Act of 1986 of the State of Illinois. The Corporation is an instrument of, but separate and apart from, the City of Chicago (the "City").

Proceeds of the Sales Tax Securitization Bonds will be used to finance certain portions of certain Chicago Recovery Plan projects. The City expects to finance new and existing projects that provide positive social outcomes for communities across the City such as (1) the construction of more than 2,000 units of affordable housing (2) the establishment of safe and clean emergency shelter for people experiencing homelessness, (3) the clean-up and sale of more the 5,000 vacant lots, (4) the planting of 15,000 trees Citywide, (5) the replacement of nearly 200 of the City’s gas powered vehicles with electronic vehicles and charging stations. Please see the Preliminary Official Statement for more details.

The Senior Lien Series 2023 Bonds are limited obligations of The Corporation and are payable solely from the Sales Tax Revenues and the other collateral pledged under the Senior Lien Indenture. The Corporation has purchased the Sales Tax Revenues from the City pursuant to the Sale Agreement. The Corporation has no financial assets available for the payment of the Bonds or Subordinated Indebtedness other than the Sales Tax Revenue and other collateral pledged, as applicable, under the Senior Lien Indenture. See the Preliminary Official Statement for more details.

The Sales Tax Securitization Bonds are subject to optional and mandatory sinking fund redemption prior to maturity as described in the Preliminary Official Statement. The bonds are rated “AA-“ (positive outlook) by S&P, “AA” (positive outlook) by Fitch Ratings, and “AAA” by Kroll Bond Rating Agency2.

Key benefits

The bond sale offers attractive benefits to individual investors, including prices and yields that match those available to institutional investors and the potential for stable income through the call dates. Illinois residents enjoy state tax-exemption on the tax-exempt bond coupon payments.

How to place an order

The offering is expected to price the week of January 16, 20231 although market conditions and/or the discretion of the issuer may alter the anticipated timeline. Individual investors can place orders online or by calling a Fidelity representative at 800-544-5372. To stay up-to-date on pricing, credit rating changes, and more, please sign up for Fidelity Alerts and see our Municipal Bond New Issue Offerings.

Additional resources

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