On the heels of an upgraded bond rating (by Fitch Ratings, from a “Stable” Outlook to “Positive”) the District of Columbia Water and Sewer Authority (DC WASA) successfully issued $300 million in its Series 2009A Public Utility Senior Lien Revenue Bonds. The bonds were issued at 5.52 percent True Interest Cost (TIC) with an average life of 23.5 years. The retail order period began Tuesday, January 27 and was so successful that the institutional period was accelerated from Wednesday, January 28 to Tuesday, January 27. By day’s end, there were more orders received than debt to sell.

DC WASA Chief Financial Officer Olu Adebo commented on the bond sale, “This successful offering demonstrates that the market recognizes the financial strength and stability of DC WASA. Not only were we oversubscribed, but we had interest from high quality firms and from the retail sector.” Top institutional investors included Chubb, First Union, Hartford Life Insurance and T. Rowe Price.

DC WASA General Manager Jerry N. Johnson also commented today, “This is good news for DC WASA and its customers. This issuance of debt will enable the Authority to move forward with much-needed capital improvements. We have recently performed both a water and sewer assessment that identified critical projects for the near future.” The two most costly capital projects are federally mandated for environmental protection and constitute about half of the current 10-year Capital Improvement Plan.

Fitch Ratings, in upgrading DC WASA from a “Stable” Outlook to a “Positive” Outlook earlier this month, cited as reasons for the upgrade, “WASA’s financial management remains a credit strength.” Fitch further commended the Authority’s “moderate annual rate increases, sound cost control, and a notable reduction in delinquent accounts.”