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Demand high for first series of state highway bonds

Aug. 26, 1999 (Release 99-179)
News Contact: Stan Whitley, (785) 296-3585

Demand high for first series of state highway bonds

Kansas Department of Transportation Secretary E. Dean Carlson announced today that orders by Kansas residents exceeded expectations on the first series of highway bonds to help fund the Comprehensive Transportation Program.

"We anticipated $60 million in orders from individuals based on experience from our previous program," said Carlson. "Orders by individual investors were approximately twice that amount. This response reflects the confidence Kansas investors have in supporting the state transportation program."

Bond orders on Wednesday, August 25, were restricted to individual investors, providing them the opportunity of actively participating in financing improvements for the program. The remainder of the 1999 series bonds were offered Thursday to major institutional investors such as insurance companies and mutual funds.

Carlson said there is also good news concerning the interest rate that will be paid on the highway bonds.

"The strong demand for the highway bonds and recent improved market conditions resulted in a lower interest rate than we anticipated earlier this week," said Carlson. "This will benefit the taxpayers of Kansas since the state will be paying less interest on the highway bonds."

Bonds were offered to mature starting in 2005 and each year thereafter through 2019. Carlson said there were more orders than bonds available in several of the years.

"I asked that we honor our commitment to the Kansas investors even though we had to increase the planned amount of bonds to be sold by an additional $25 million to $325 million," said Carlson.

The 1999 Legislature authorized the issuance of up to $995 million in highway bonds to help finance the state's 10-year Comprehensive Transportation Program. The $325 million is the first issue of bonds in Kansas for the new program.