The Consolidated Commission on Utilities (CCU) Chairman Joseph Duenas and Guam Waterworks Authority (GWA) General Manager Miguel C. Bordallo signed the closing documents for $143.3 million in Series 2016 Water and Wastewater System Revenue Bonds, today at the Gloria B. Nelson Public Service Building in Mangilao.
“The CCU’s guidance and the hard work of the GWA management team contributed significantly to positive credit evaluations for the bond sale and, in combination with the solid economic outlook for Guam, resulted in high demand and lower than anticipated interest rates,” said CCU Chair Joseph “Joey” Duenas. “On behalf of the Commission and the GWA employees, we would like to thank the Public Utilities Commission (PUC) for their ongoing support and of course the ratepayers of Guam. We could not do this without them”, Duenas added.
IMPROVEMENTS TO THE WATER AND WASTEWATER SYSTEM
GWA intends to fund needed capital improvements to the existing water and wastewater systems with the Series 2016 Bonds. These projects range from drilling new water wells, building concrete water tanks, installing water lines and upgrading the entire Southern wastewater system to include a “state of the art” wastewater plant to be in operation by December 2016.
CONTINUED IMPROVEMENT IN UTILITY OPERATIONS
Over the past several years, the CCU and GWA Management have worked hard to improve fiscal and operational performance, control costs, and ensure compliance with the 2011 Court Order and existing environmental regulations. GWA has also been working collaboratively with the USEPA to address compliance issues and provide GWA employees tools for improving operations and management of existing and new assets to be constructed. Such collaboration has resulted in GWA’s two largest wastewater facilities, which together have the capacity to treat over 90% of Guam’s wastewater, being in primary advanced treatment compliance for the first time since the Clean Water Act was passed.
INVESTMENT-GRADE RATINGS, HIGH DEMAND FOR GWA BONDS
The CCU and GWA Management team made significant efforts to meet with rating agencies and investors during the course of the bond process. The bond received three investment grade ratings: “A-” from S&P, “BBB-” from Fitch and “Baa2” from Moody’s. “Improving our fiscal and operational management has been sustained since we first went out to the bond market which resulted in our success”, added Chairman Duenas
Guam investors were given the first priority in submitting orders in advance of the bond sale period in New York. Local investors placed over $900,000 in orders for the GWA bonds. Once the sale period had ended in New York on February 10th, orders exceeded the available bonds by 10-times.
Bond proceeds will be deposited with the bond trustee, Bank of Guam, this evening around 11:45 pm.
For more information about this or other GWA issues contact:
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Heidi M. Ballendorf
Guam Waterworks Authority