By Gary Brode, WBZ-TVFebruary 21, 2018 at 5:48 pm
CAMBRIDGE (CBS) — Looking to invest in your city and account? One way to do that if you live in Cambridge is to buy the city’s mini-bonds.
Lawrence Ferrara lives in Cambridge. He says, “I think it’s a good idea to offer them. A lot of people in the city that maybe would like to invest.”
Many already have. Since the City of Cambridge started offering mini-bonds Tuesday, they’ve sold more than $800,000.
Last year during the pilot program, the city raised $2 million in less than a week.
Budget Director for the City of Cambridge Sarah Stanton says, “It’s allowing community members to see what the city is in and invest in it themselves.”
Invested money is spread across the city from at the public library to a new roof at Fletcher-Maynard Academy, and general construction at King Open School.
A mini-bond is like a municipal bond, just more affordable.
Stanton explains, “The smallest increment you can buy a bond is 1,000 dollars, whereas usually, it’s a 5,000 increment.”
A single investor can buy as much as $25,000 worth of bonds.
The bonds interest rate is fixed at 2% and will be paid out in five years.
The last day to invest is Monday, February 26th or when the city raises $2,500,000.
MMA Associate Editor Daniel DeMaina
March 6, 2017
Cambridge is expanding its efforts to get residents more engaged on finance and budget issues by selling “minibonds” for the first time to finance several forthcoming capital projects.
The city has partnered with website Neighborly Securities to sell five-year bonds starting at $1,000, with residents able to purchase up to 20 bonds for a total investment of $20,000. Bonds were available for sale from Feb. 17 through Feb. 23.
The bond yield rate set on Feb. 17 was 1.6 percent, so buyers will receive a semiannual interest return based on that rate, according to Cambridge Budget Director Jeana Franconi, with the full value of the bond paid back in 2022.
Previously, the city only sold municipal bonds in denominations of $5,000 or more, with a commercial sale every year that required residents to go through their own brokers to purchase municipal bonds.Read more
February 15, 2017
Minibond sale opens on February 17 and closes on February 23, 2017
The City of Cambridge is offering Cambridge residents the chance to directly invest in Cambridge by buying $1,000 denomination minibonds. The City will use minibond proceeds to support capital projects such as school building renovations, municipal facility upgrades and implementation of the Complete Streets plan.
What are minibonds? How are they different from traditional municipal bonds?
According to the Cambridge Minibonds website, a minibond is like a traditional municipal bond in which you loan money to a city or public agency for an agreed period of time, receive interest on your investment, and get your loan paid back when the bonds mature. Minibonds are different because they can be purchased for as little as $1,000. All municipal bonds previously sold by the City of Cambridge were sold in denominations of $5,000 or more, so the minibonds can be a more affordable option for residents. Another difference is that interest on minibonds will be paid semiannually and the 2017 Cambridge minibonds will mature in five year, whareas most Cambridge municipal bonds mature after 10 or 20 years.
February 14, 2017
We know you are vested in Cambridge's future; now you can directly invest in it with minibonds!
Watch the video below:
January 25, 2017
The City of Cambridge is trying to attract small investors to buy its municipal bonds, to fund work on schools, streets, and ball fields. The so-called minibonds will be available in increments of $1,000, instead of the usual $5,000. They’ll have a duration of five years and will be part of $2 million in bonds set aside for Cambridge residents in a total $65.8 million public debt offering. The munis will be sold online, with no fee, according to Cambridge Budget Director Jeana Franconi. Neighborly Securities, a San Francisco-based brokerage, will handle the sales. Franconi said the city was looking at “how we could engage the community more in our financial process.” The minibonds will be priced Feb. 17 and will be sold through Feb. 23. Current yields on such bonds, which are tax-exempt, would be 1.6 percent.
Press Release: City Announces First Minibond Issuance, Invites Residents to Directly Invest in Cambridge
January 23, 2017
The City of Cambridge is pleased to announce that it intends to offer Cambridge residents the chance to invest directly in Cambridge infrastructure by purchasing minibonds. Minibonds enable residents to earn tax-exempt interest and invest for the future while supporting the Cambridge capital budget.
A minibond is similar to a traditional municipal bond in which investors loan money to a city or public agency for an agreed period of time, receive interest on the investment, and get their loan paid back when the bond matures. The City will use minibond proceeds to support capital projects such as school building renovations, municipal facility upgrades, and implementation of the Complete Streets plan.
All municipal bonds previously sold by the City were sold in denominations of $5,000 or more. Minibonds are different because residents can purchase them for as little as $1,000, making them more accessible than traditional municipal bonds for potential investors.Read more
January 19, 2017
From NECN: Neighborly Securities is working with officials in Cambridge, Massachusetts, to give residents the chance to invest in the city's infrastructure by buying minibonds. Pitichoke Chulapamornsri, Neighborly's director of business development, and Cambridge City Councelor Leland Cheung join NECN.
Watch the interview below:
Neighborly has developed a 10-part Beginner's Guide to Municipal Bonds. Visit the Neighborly website to learn more and download the guide.