Fitch Ratings Upgrades DC Water to “AA+” and “AA”
August 20, 2019
Fitch Ratings upgraded the following District of Columbia Water and Sewer Authority ratings:
- Senior lien public utility revenue bonds to ‘AA+’ from ‘AA’
- Subordinate lien public utility revenue and refunding bonds to ‘AA’ from ‘AA-’
Fitch also affirmed DC Water’s Extendable Municipal Commercial Paper (EMCP) notes, series A, at F1+.
Rating agency opinions influence investors. Higher credit ratings result in lower interest rates for repayment, in general. “Responsible stewardship of the funds paid by our ratepayers is one of our highest priorities at DC Water,” said DC Water Board Chairman Tommy Wells. “Lowering the cost of borrowing the money needed to meet the requirements of a first-in-its-class water and sewer system is our obligation. We are proud of our team for accomplishing this milestone.”
Added David L. Gadis, DC Water CEO, “Even as DC Water’s debt service grows, we are still viewed as a stable investment due to our sound financial management and the essential service we provide to a growing region. The recent upgrade is a testament to our sustained exemplary financial performance and the thoughtful guidance of the Board of Directors.”
Other factors included the dynamic economy in our service area and diverse customer base.
DC Water CFO and EVP, Finance and Procurement, Matthew Brown, said, “This upgrade demonstrates Fitch’s confidence in our outstanding financial performance and management of our capital program. It recognizes that DC Water, through the Board of Directors, will continue to maintain strong reserves and adjust rates to ensure that we can deliver this program that includes the Clean Rivers Project and upgrades to our wastewater treatment, sewer, and water infrastructure..
DC Water’s last bond offering was in April 2018 and was well subscribed with orders received of over $1 billion. In 2014, the Authority issued a $350 million green century bond and in 2015 issued an additional $100 million in green bonds. The former earned Bond Buyer’s “Regional Deal of the Year Award” and the IWA Global Water Awards for “Water Deal of the Year.”