Orchard Park, N.Y. (WBEN) - Monday marks the start of the retail sale of Bills Bonds to help Erie County raise money to fulfill its payment obligation for construction of the new Highmark Stadium along Abbott Road. You must have a brokerage account to invest in these municipal bonds.
Erie County Comptroller Kevin Hardwick says there's a one day retail sale for anyone in Erie County to invest in these municipal bonds.
"They would help us cover our share the county share of the cost of the new Highmark Stadium. That cost is $250 million that was decided by the county legislature and the county executive a couple years ago. And they also decided that $125 million of that would be paid with cash, the remaining $125 million would be paid through bonding," said Hardwick with WBEN.
Hardwick says the minimum investment is $5,000, with the maxiumum investment being all the way up to $250,000.
"Tuesday, we're opening it up to the institutional investors, and they'll come in probably and buy up millions of dollars of these bonds at the time," Hardwick said.
He notes with any investment, there are inherent risks, but you will get interest paid twice a year.
"Then eventually you'll get your principal back, the $5,000 back when the bond matures, which will be in 25 years," Hardwick noted.
Michael Angelucci of Level Financial Advisers says these bonds are tax free.
"They issue bonds that will pay a rate of interest over the next 20 or 30 years to whoever buys those bonds, and that interest will be New York State tax free, if you're a New York State resident that buys that bond and federally, tax free when you do your taxes," explained Angelucci with WBEN.
Angelucci says municipal bonds like Bills Bonds are good investments.
"They have a very low rate of default, and they'll pay, maybe, five percent, but that's tax free. depending on what your your tax rate is, what you're paying in taxes, it could be worth more than that, because if you buy other types of bonds, corporate bonds, you have to pay income tax and and state tax on that earnings. So they're generally a good deal, and especially a very good deal for people in higher tax brackets," Angelucci said.
One important note before you invest is you'll need a brokerage account.
"It might be too late as far as if they are able to set up a brokerage account quick enough for the initial issue, but at some point through their regular broker, they could buy these bonds, potentially on the secondary market," Angelucci explained.
Angelucci says after they're issued, different investors may want to sell them at different times for different reasons, and that will be subject to whatever interest rates are at the time.
Stadium construction is expected to be finished by 2026.