WaterSource New Masthead

  

May 27, 2016    
In This Issue
S&P Raises Water Authority's Senior Lien Credit Rating to AAA
Region's Success Saving Water Continues with Sharp Reduction in April Use
Proposed Rate Increases for 2017 Driven by MWD and Desalination

Did you see?
The San Jose Mercury News published an Op-Ed by Water Authority Board Chair Mark Weston on May 16 about the common ground Northern and Southern California share in making the most of water resources.
"Indeed, San Diego County and the Bay Area share a commitment to making the most of every drop of water, as well as a common desire for the Sacramento-San Joaquin Delta to meet the coequal goals of water supply reliability and environmental restoration," said Weston.
Click here to read.

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San Diego County Water Authority


S&P Raises Water Authority's Senior Lien Credit Rating to AAA
Highest rating in agency history will reduce financing costs, benefit ratepayers
S&P Global Ratings announced Wednesday that it has upgraded the Water Authority's senior lien credit rating to AAA, a boon for ratepayers who will benefit from lower financing costs. This marks the first time the Water Authority has achieved a AAA senior lien rating, the highest offered by S&P.
The ratings service -- one of the big three international ratings agencies -- credited the upgrade to strong financial management, robust drought planning, increased storage capacity due to the San Vicente Dam Raise, and reserves for managing contingencies, among other factors.
The improved ratings resulted from the Water Authority's actions to refinance $340 million in 2016 A&B long-term water revenue refunding bonds and $86 million in a 2016 S-1 five-year, short-term refunding note. The bonds will be priced in early June, and the higher rating from S&P is expected to lower the interest rate that the Water Authority will have to pay. Since 2005, the Water Authority has saved $78 million through five previous bond refundings, and the upcoming refunding is expected to save approximately $50 million.
More information about the Water Authority's finances is at www.sdcwa.org/finance-investor-relations.
 
Region's Success Saving Water Continues with Sharp Reduction in April Use
Residents and businesses conserve at the county's highest rate in seven months
Preliminary data released by the Water Authority show that the San Diego region continues to beat the state's aggregate water savings target, reducing cumulative potable water use 21 percent from June 2015 through April 2016. The savings (compared to 2013) were bolstered by a 23 percent reduction in water use in April, the county's highest savings rate since September.
Under the current state regulation, the region's aggregate cumulative water-savings target is 13 percent - down from 20 percent between June 2015 and February 2016 due to credits for drought-resilient water supplies from the Claude "Bud" Lewis Carlsbad Desalination Plant. The plant produces up to 56,000 acre-feet per year, enough to serve roughly 400,000 residents.
Beginning in June, the State Water Board's regulation will allow communities to tailor drought responses to the unique situation in each service area. This revision followed assessments of water supply conditions, which this year were boosted by El Niņo weather patterns through winter and spring that produced significant rain and snow in Northern California.
More information about the new state regulation is at www.sdcwa.org/state-board-regulations.
For information about conservation programs, as well as water-use rules by community and drought conditions, go to www.whenindrought.org
Proposed Rate Increases for 2017 Driven by MWD and Desalination
Increases would be 6.4 percent for untreated water and 5.9 percent for treated water
The Water Authority staff has proposed increasing rates charged to member agencies by 6.4 percent for untreated water and 5.9 percent for treated water in calendar year 2017, similar to the increases adopted by the Board of Directors for 2016.
Next year's rate proposal is primarily driven by higher costs from the Metropolitan Water District of Southern California. In addition, it incorporates higher costs for drought-proof water supplies from the Claude "Bud" Lewis Carlsbad Desalination Plant.
The rates are also impacted by state-mandated reductions in water use that are expected to lower the Water Authority's sales compared to previous projections.
Careful financial management by the Water Authority has kept the proposed rates near the low end of its projections and well below the double-digit increases during the last drought that were driven by steep price hikes from MWD.
Proposed 2017 rates were formally presented to the Water Authority Board on May 26. The Board will hold a public hearing on the 2017 rates and consider their adoption on June 23.
For more information about the Water Authority's proposed rates, go to sdcwa.org/monthly-board-meeting-60
, click on the Board packet and go to page 116.
The San Diego County Water Authority sustains a $218 billion regional economy and the quality of life for 3.2 million residents through a multi-decade water supply diversification plan, major infrastructure investments and forward-thinking policies that promote fiscal and environmental responsibility. A public agency created in 1944, the Water Authority delivers wholesale water supplies to 24 retail water providers, including cities, special districts and a military base.