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Finance: Virginia

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Virginia Port Bond Refinance Expected to Cut Debt Cost by $15 Million 

Buoyed by strong reviews from three leading bond ratings agencies, the Virginia Port Authority (VPA) earlier this month completed the sale of $141.8 million of port facilities revenue refunding bonds. 

More than $400 million worth of orders placed for the bonds during the sale process. They were sold in two series: one tax-exempt ($85.1 million of principal) and one taxable ($56.7 million of principal). 

"As a result of the sale, the VPA will reduce its debt costs and realize significant savings," said John F. Reinhart, the VPA’s CEO and executive director. "We will realize net savings of $14.7 million on a present value basis, equal to 9.9 percent of the refinanced debt." 

Just prior to the bond sale, Fitch Ratings announced that it had upgraded its long-term rating of the VPA’s outstanding port facilities revenue bonds to A with a "stable" rating. The Fitch rating followed similar ratings of VPA bonds published in late February by Moody’s Investors Service and Standard & Poor’s, which gave Aa3 and A ratings, respectively. 

The rating agencies noted the port’s focus on streamlining operations, its plan to optimize facilities for capacity and operating efficiencies, a leading East Coast market position in the container trade, the capability to accommodate the new generation of larger container vessels, and excellent intermodal links. 

The bonds are expected to settle on March 19.
 

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