Minnesota Finalizes Sale of $757 Million in Tobacco Bonds
ST. PAUL, Minn. (AP) – Minnesota finance officials say they’ve completed the sale of $757 million in bonds using the state’s future tobacco lawsuit settlement dollars as the repayment stream.
The finalized sale announced Thursday will generate a one-time infusion to temporarily close a state budget gap. But the debt will cost the state more than $1 billion to pay off over the next two decades. An exact cost wasn’t immediately available.
An assistant commissioner at the Department of Minnesota Management and Budget says the market for the bonds was stronger than expected.
The sale nets $640 million for the budget fix and the rest will go into a special account to cover the cost of issuing them and create a reserve fund that can be used for repayment.
(Copyright 2011 by The Associated Press. All Rights Reserved.)