What is the opportunity?
The Massachusetts School Building Authority (the "Authority") is issuing $395 million1 in Subordinated Dedicated Sales Tax Bonds, 2018 Series A. The proceeds of the 2018A Bonds will be used to (i) pay the outstanding Commercial Paper Notes on their respective maturity dates, and (ii) pay the costs of issuing the 2018A Bonds.
The 2018A Bonds are subordinate special obligations of the Authority, secured as to the payment of principal, premium, if any, and interest thereon by a subordinate lien on and pledge of certain revenues and other moneys, including without limitation, the Dedicated Sales Tax Revenue Amount and certain funds and accounts held under the Trust Agreement. The Authority has no taxing power. Neither the Commonwealth of Massachusetts nor any political subdivision thereof shall be obligated to pay the principal of, or premium, if any, or interest on any 2018A Bonds.
Traditionally, municipal bonds will be subject to optional call features, and term bonds will generally have a Mandatory Sinking Fund feature. Before placing an order, please review the structure on the day of the pricing.
The bonds are rated Aa3 by Moody's and AA by S&P2
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. And, for Massachusetts residents, federal and state tax-exemption on the bond coupon payments.
How to place an order
The offering is expected to price the week of January 22,1 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.