Last week, the City of Winnipeg reaffirmed its commitment to strategic, long-term investment by issuing its first new long-term debt in nearly four years to help fund important capital projects.
The City issued $200 million in new bonds, on a 40-year term at a coupon rate of 4.65%. The funds are earmarked for projects like the enhancement of the South End Water Pollution Control Centre, the new North District Police Station, the renewal of the St. James Civic Centre, and the construction of the Bill and Helen Norrie Library. Unlike federal and provincial governments, Winnipeg cannot legally borrow to balance operating budgets.
“This is the first time Winnipeg has issued new long-term debt for capital projects since May 2020, and there was solid market demand for these securities,” said Mayor Scott Gillingham. “This speaks to the strong financial management and prudent debt policy of the City.”
Winnipeg has secured several stable and positive credit reviews by rating agencies in recent years, including an AA+ Stable rating from Standard & Poor’s that has been in place since June 2022. The AA+ rating is the second-highest bond rating the agency can assign.
The City of Winnipeg is one of a small number of Canadian municipalities with the capacity to market its own capital debt directly to insurance companies, investment banks, and other institutional investors.
“This bond issue not only funds essential infrastructure projects but also reaffirms the City of Winnipeg's commitment to strategic, long-term investment in our future, underpinned by a foundation of strong financial management,” said Councillor Jeff Browaty, Chair of Finance.
City Council is expected to debate an updated debt management policy in the next few months, parallel with consideration of the upcoming 2024-27 Multi-Year Balanced Budget.