Clarification of the Bond Issuing Process
Grand Forks, ND - Altru Health System is issuing bonds in the amount of $115 million, some of which will go toward replacing the Main Clinic. This is a regular business process and financial strategy that we go through every several years.
We understand that issuing bonds could be a confusing process. We would like to take this opportunity to clarify a few items in recent news:
- Altru Health System is not asking the community for funds. This is an investment process for issuing municipal bonds; therefore, it is incorrect to say we are asking Grand Forks for money. The city is only involved because of rules requiring we have a relationship with a local governing authority in order to issue the bonds.
- A bond is a debt investment in which an investor loans money to an entity which borrows the funds for a defined period of time at a variable or fixed interest rate. Companies issue bonds as they desire to borrow money. They issue bonds and investors buy them. This means the bond issuer is obligated to pay back the principal and interest to the bondholder over time.
- Bond issuing is a common practice that is necessary in order to reinvest in our community healthcare assets and provide the best care possible for our patients.