Investors talk Massachusetts debt

December 16, 2013

The Massachusetts Treasurer Steve Grossman headlined an all-day investor conference for the state’s debt last week. The slides were published on EMMA. Like other states and cities, Massachusetts has a number of agencies issuing debt in addition to the Commonwealth (there are 12 that you can see at the bottom of this post). Let’s have a look at the conference highlights:

Real estate remains sluggish:

The state is especially dependent on federal spending from the Department of Defense, research and healthcare.

Five market participants were polled on federal issues related to muniland:

Transportation funding has become more state-centric since Congress has not raised the federal gas tax since 1993:

Massachusetts has been a leader in issuing “green bonds”:

Municipal Market Advisors Founder Tom Doe details the rocky performance of the muni market in 2013:

On a historical basis, using the 10-year maturity total rate of return, muniland is doing poorly. It hasn’t performed this weak since 1993:

Here is a great chart from Tom Doe comparing the 10-year AAA yield versus muniland bond issuance:

The debt-issuing entities in Massachusetts are:

  • Commonwealth of Massachusetts
  • Massachusetts Bay Transportation Authority
  • Massachusetts Port Authority
  • Massachusetts Water Pollution Abatement Trust
  • Massachusetts Water Resources Authority
  • University of Massachusetts Building Authority
  • Massachusetts State College Building Authority
  • Massachusetts Housing Finance Agency
  • Massachusetts Department of Transportation
  • Massachusetts School Building Authority
  • Massachusetts Development Finance Agency
  • Massachusetts Educational Financing Authority
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