Hartford Mayor Luke Bronin said the Connecticut capital will negotiate with bondholders and the state to “end up with a debt-service burden that is manageable over the long term,” though he declined to say whether that may impose losses on owners of its debt, Bloomberg News reported yesterday. “You use the terms restructuring, refinancing, rescheduling, refunding and there’s probably a Venn diagram where they overlap and then there are ways in which they differ," he said yesterday. "The terms of any bond deal will have to be negotiated and, again, they will depend to a large extent on what the state is willing to do as part of a long-term solution.” Hartford’s bonds rallied last week after Connecticut lawmakers passed a budget by a veto-proof majority that would provide the city with a financial rescue to keep it out of bankruptcy. Bronin had said that he would need to seek court protection from creditors if Connecticut didn’t step in. The budget would give Hartford as much as $48 million, enough to cover almost all of its current deficit, and lend the state’s backing for a debt refinancing. Refinancing some of the city’s $620 million debt at lower rates would allow it to avoid a spike in interest and principal payments starting in 2021 by extending maturity dates on the securities. About $225 million of Hartford debt wasn’t insured against default when it was issued.
