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SFPUC approves $150 million letter of credit and dealer agreements for wastewater commercial paper program
Summary
The commission approved a form of credit facility with Sumitomo Mitsui Banking Corporation (up to $150 million) and dealer agreements with Citigroup, Morgan Stanley and U.S. Bank to support the wastewater commercial paper program; staff said terms are competitive and the facility supports interim financing for wastewater CIP.
The San Francisco Public Utilities Commission on Feb. 14 approved a credit facility and associated dealer agreements that support the wastewater commercial paper program.
Eric Sandler, the commission’s CFO, said the requested documents include an irrevocable letter of credit and reimbursement agreement with Sumitomo Mitsui Banking Corporation for up to $150 million in principal, over a four‑year term with three one‑year extension options. Dealer agreements with Citigroup, Morgan Stanley and U.S. Bank were proposed to remain coterminous with the credit facility to support commercial paper issuance on a fee structure consistent with prior arrangements.
Sandler said the wastewater commercial paper program provides low‑cost interim financing for the wastewater CIP, including the Sewer System Improvement Program, and that the RFP for letters of credit produced competitive responses. The commission moved, seconded and approved the credit facility and dealer agreements by voice vote.
Next steps: staff will finalize the facility and dealer documents and proceed with implementation of the commercial paper program in support of wastewater capital cash flow needs.
