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Water Trust authorizes up to $220 million in refunding and improvement bonds
Summary
The Oklahoma City Water Utilities Trust approved a resolution to issue up to $220 million in revenue refunding and improvement bonds to refund about $50 million of commercial paper and provide roughly $150 million in new financing to bridge capital project cash needs; ratings were affirmed at AAA.
The Oklahoma City Water Utilities Trust on Oct. 7 approved a resolution authorizing the issuance of utility system revenue refunding and improvement bonds not to exceed $220 million.
PFM financial adviser Dennis Whaley told trustees the transaction would refund approximately $50 million of outstanding commercial paper and raise about $150 million of new money to restore appropriation capacity for the city's commercial paper program and bridge cash needs for capital improvement projects over the next 18 to 24 months. Whaley said Moody's and S&P affirmed the trust's ratings at AAA with a stable outlook and that the trust expects a negotiated sale with Morgan Stanley on Oct. 23.
The presentation summarized the rationale: multi-year, high-dollar construction awards have stretched the time between contract awards and actual cash outlays, reducing available CP appropriation capacity. The proposed refunding would restore that capacity while providing near-term liquidity for ongoing projects.
Trustees recorded a motion, second and voice vote; the chair announced the resolution passed. The record did not include mover/second names or a detailed roll-call tally.
Next steps announced in the meeting: final transaction documents, rating confirmations (already received) and the planned negotiated sale later in October.
