The Commissioners of St. Mary’s County voted 3-1 on Aug. 18 to accept the winning bid on a $61.5 million general obligation bond sale, the final step in a financing process that began two months earlier with a closer, more contested vote over the size of the borrowing itself.
JP Morgan won the bid among 16 submissions, at an interest rate of 3.97%, according to the commissioners’ own meeting summary. Commissioners emphasized that the money itself was not new spending — the projects being financed were already approved in prior county budgets, and the August vote was the mechanism for actually borrowing the funds at the best available rate. Commissioner Scott Ostrow cast the lone dissenting vote.
The bonds carry strong marks from all three major rating agencies: AAA from Fitch, Aa1 from Moody’s, and AA+ from Standard & Poor’s. The county’s own Department of Finance describes that combination as reflecting “very strong” creditworthiness, a rating tier that typically allows a local government to borrow at lower interest rates than lower-rated peers.
The August vote followed a closer decision in June. On June 23, commissioners voted 3-2 to authorize the sale and issuance of the same $61.5 million in bonds, with Commissioners Ostrow and Mike Hewitt opposed, according to Southern Maryland Chronicle’s coverage of that meeting. At the time, the county estimated an interest rate of 3.71% — roughly a quarter of a percentage point lower than the 3.97% rate ultimately locked in when JP Morgan’s bid was accepted in August. The two-month gap between authorization and final pricing is a normal part of the municipal bond process, during which actual market rates can move before a sale is finalized. The vote count itself also changed, from 3-2 in June to 3-1 in August; this article was not able to confirm from available records whether that reflects a changed position or an absence, and does not speculate further.
According to the June coverage, bond proceeds are earmarked for a range of capital projects, including roadway and safety improvements, renovations at the St. Clement’s Island Museum, the YMCA in Great Mills, multiple school projects, and $1.5 million to launch a new Fire & Rescue Revolving Loan Program, which will let volunteer fire and rescue companies borrow at lower rates than they could obtain independently.
The bond sale is part of a larger, previously authorized borrowing capacity. Under state enabling legislation passed by the Maryland General Assembly, St. Mary’s County can issue up to $71 million in general obligation bonds for public buildings, facilities, and public works projects, with bond maturities capped at 30 years, according to a legislative fiscal analysis. As of the end of fiscal 2023, the county carried approximately $238.4 million in total outstanding debt — about 1.7% of the county’s assessable property tax base, or roughly $2,077 per resident, the same analysis found.
County officials have framed the August action as a routine but important step: locking in financing terms for infrastructure and community projects the board had already committed to funding, at rates reflecting the county’s strong credit standing even as borrowing costs shifted somewhat between the June authorization and the August sale.
