Water & Wastewater Bond Program
California Statewide Communities Development Authority (CSCDA) would like to invite local agencies to submit applications for the newly updated Water and Wastewater Bond Program (WWBP). As with CSCDA Public Agency programs, local agencies can benefit from lower costs and ease of execution in funding water and sewer projects through WWBP. Further, the pooled issues will be insured by Build America Mutual and will utilize a surety reserve in lieu of funding with cash.
CSCDA has issued nearly $500,000,000 of bonds through its water and sewer program, and has assisted 41 local agencies. Projects funded range from $800,000 to $45,000,000. Under the new program, projects can be pooled or issued on a stand-alone basis depending on size, credit and an optimal funding plan.
WWBP can finance a variety of projects, such as:
The program will fund projects by issuing revenue bonds through CSCDA that will be insured by Build America Mutual (BAM) and utilize a surety to satisfy the reserve requirement. If the Local Agency applicant meets certain minimum credit requirements, as summarized below, neither CSCDA nor BAM will require an underlying rating to participate in the Program.
- Plant upgrades.
- Expanded collector systems.
- New pump stations.
- Deferred maintenance.
- Equipment replacement.
- Refunding of outstanding debt.
Each local agency must:
- Become a member of CSCDA, if they are not already (must simply pass a Resolution).
- Submit a simple on-line application for funding.
- Adopt a Resolution authorizing CSCDA to issue the bonds, and to approve a form of installment sale agreement, which is the underlying security for the bonds.
- Assist in the preparation ofwhat is called Appendix A of the Preliminary Official Statement which describes the participants proposed project and water or wastewater system.
- Enter into a Net Revenue Pledge to secure its share of the bonds (Revenues less Expenses).
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- Net revenues must be at least 1.25x annual debt service.
- The Enterprise must have at least 1,000 connections.
- No one, single customer shall account for greater than 30% of revenues.
- Aggregate top ten customers should not exceed 60% of revenues.
- Enterprise has historically maintained 90 days cash on hand for operating expenses.
- Debt levels should generally not exceed $8,000 per customer account.