Richard Dulaney
By Scott Robertson
The man pictured here is named Richard Dulaney. He is employed by Raymond James & Associates, serving as financial advisor for Washington County. Because he works out of an office in Nashville, the odds are good you’ve never seen him before. But if you do run across him, you might want to shake his hand.
Dulaney is a walking example of why it matters that governments hire people who understand how money works.
The back story goes like this: almost a decade ago, Washington County’s elected officials needed to build two new schools and a single facility to replace the county courthouse and jail. They floated a bond offering to do it all in one fell swoop.
On Jan. 23, 2007, the county entered into an agreement that has seen it make interest-only payments for years, paying 2007 interest rates the entire time. In short, Washington County has been overpaying for money.
In 2016, the county was finally able to address this issue. Dulaney met with county leaders to discuss ways of prepaying the remainder of the 2007 debt and setting up a new bond issue with lower interest rates. The net effect of all this would be to save the county money without prolonging the payment period.
The process was painstaking. The county had to submit the plan to the state comptroller’s office, which in turn submitted a report back to the county commission, which gave the go-ahead to the new issue. Dulaney estimated at that time the county could save roughly $14 million by, in essence, refinancing the debt.
Because of the size of the issue ($130 million), county officials went with Dulaney to New York to visit with Moody’s and Standard & Poor’s ratings services. The credit committees of those services assigned ratings to the bond issue. Moody’s rated the issue Aa2, while S&P rated it AA.
All was going on schedule when Dulaney really began to earn his money. He called County Mayor Dan Eldridge with the idea of moving the sale of the bonds from Tuesday, June 28 to Monday the 27th. Washington state was offering a $1.3 billion issue Tuesday, the same day Washington County was due to sell its $130 million. It might make sense to move the county sale up a day in order to avoid confusion in the marketplace. That move was made.
Then came the two timing of the two independences.
Dulaney had counseled for having the sale after the United Kingdom’s referendum on whether to leave the European Union (June 23) and the July 4 American Independence Day holiday. To have the sale before the Brexit vote would leave it at the mercy of an uncertain and tenuous marketplace in which buyers would likely be extremely cautious. Just so, to hold the sale anywhere in the two weeks following the holiday would be to eliminate every potential buyer who would be on vacation or just returning from vacation. The window was well-defined.
The timing, as it turned out, could not have gone better. Dulaney and Eldridge kept in touch on Friday the 24th as the aftermath of the Brexit vote swept the markets. If needed, they could pull the sale. However, if the markets reacted favorably, the Brexit could produce a perfect selling environment.
That’s just what happened. Dulaney watched as the market volatility drove interest rates to historically low levels. The sale happened Monday, as scheduled.
When all was said and done, the county’s savings totaled $19, 501,979.52. That’s roughly $5 million more than what anyone originally had thought could be achieved. While Dulaney can’t be credited for the Brexit vote going the way it did, he had the county in perfect position to take advantage of what happened.
Washington County will be the better for it for years to come.
