Interest rate lower than expected for first GARVEE road bond sale

CHARLESTON, W.Va.  — The interest rate for the first GARVEE bond sale is lower than state officials initially expected.

In a Friday news release, Gov. Jim Justice announced the interest rate for the first GARVEE bond sale of $260 million is 2.145 percent. The bond sale will close next Thursday.

“To get a 2.145 percent interest rate is great news,” Justice said in the Friday news release. “I am encouraged by the strong investor demand and these attractive borrowing rates for my Roads to Prosperity Highway Program. West Virginians voted Oct. 7 to climb out of the ditch and stop being 50th and this first bond sale is a fantastic start. We’re on the move.”

Smith had indicated after a Wednesday press conference on the passage of special sessions bills, that he expected better than anticipated interest rates.

“This is a crystal-clear confirmation of the need for wise investment while rates are extremely attractive,” Smith said in the Friday news release. “A rate of 2.145 percent is significantly less than the cost of construction inflation and sets us moving exactly in the right direction for the delivery of Governor Justice’s infrastructure.”

The first of three GARVEE sales will target 18 bridge replacement projects and 13 interstate rehabilitation projects across the state.

Earlier this month, West Virginians approved the Roads to Prosperity Highway Program that aims to create $1.6 billion in funds to upgrade the state’s roads and bridges.

There are three funding mechanisms for projects — GARVEE, general obligation and turnpike.

Smith previously said the general obligation projects, which are the most expensive, will take more time because there are several steps to go through. He said these bonds may be sold the middle of next year.