Vienna First Virginia Community to Issue 'Green' Bonds

VIENNA, VA — When the Town of Vienna issued approximately $6.2 million in general obligation bonds earlier this month, it was the first Virginia local jurisdiction to offer bonds with a green designation, according to an announcement fro the Town Monday. In addition, thanks to its recently reaffirmed AAA rating from both Standard & Poor’s and Moody’s, the Town was able to receive an extremely low interest rate.

The Town’s bonds, designated to help pay for renovation and expansion of the Vienna Community Center, which will be LEED (Leadership in Energy and Environmental Design) silver-certified, as well as stormwater and water and sewer improvements, were issued at a true interest cost of 2.16%. By comparison, on the same day, December 9, U.S. Treasury bonds were on the market at 2.32%.

“This is great news for the Town of Vienna,” says Mayor Laurie DiRocco. “We’re now reaping the benefits of our fiscally conservative policies and practices. The local economy certainly helped us achieve such an amazing interest rate, but Vienna also has worked hard to manage its finances well. Our practices and policies show a great deal of fiscal responsibility and maturity. I’m very proud of our Council and staff.”

Green general obligation bonds are issued for qualified projects that in some way protect or enhance the environment. The green designation, says Finance Director Karen Spence, attracted environmentally conscious investors who want to finance green-friendly infrastructure.

“The Town’s very attractive AAA bond rating coupled with the green designation,” she says, “encouraged many investors to bid on the bonds.”

While the green designation didn’t impact the interest rate the Town received, Spence adds, it did expose the Town to a group of niche investors.

The Town will use 86% of bond proceeds for the community center project with the remainder of funds designated for stormwater and water and sewer improvements.