.jpg)
MARTINEZ – Central Contra Costa Sanitary District (Central San) recently received Standard & Poor’s “AAA” rating for $19.43 million of wastewater revenue refunding bonds. The “AAA” rating is the highest assigned by Standard & Poor and allows Central San to achieve low interest rates. The bonds were priced on August 14th at yields significantly below a benchmark index of municipal bonds (the Thomson Reuters Municipal Market Data (MMD) index), reflecting very strong investor demand for the agency’s debt. The proceeds from the new bonds will be used to refinance bonds issued in 2009, saving
customers more than $8.2 million in interest costs over the next 11 years.
The savings will be used to fund critical infrastructure improvements identified in a 20-year master plan. Using a combination of pay-as-you-go and debt-financing, Central San continues to fund extensive infrastructure improvements that will upgrade the regional treatment plant, service and repair pumping stations, and replace several miles of sewer pipe each year to provide sewer service reliability for decades to come. Using external consultants to validate the analysis, rates are reviewed annually to ensure that charges accurately reflect the cost of providing service to customers.
Standard & Poor ratings opinion is available on Central San’s website, and cited “
the combination of an extremely strong enterprise risk profile and an extremely strong financial risk profile”. Factors supporting this include strong operational management practices and policies, alignment with strategic goals, and strong financial management practices and policies, including reserve policies.
Strong financial management practices include controlling costs and addressing employment related liabilities. The agency has had essentially a flat O&M budget for about five years. In 2018, the Board of Directors established a trust for funding employee retirement obligations beyond the required annual contributions, adding $5.4 million to the trust. Additionally, the agency has also made contributions to further fund other post-employment benefit (OPEB) commitments. Setting aside funding to address these obligations is an industry best management practice which demonstrates fiscal responsibility and ultimately reduces operating costs for customers.
About Central San
Central San’s mission is to protect public health and the environment through safe and effective wastewater collection, treatment, and disposal. It also operates a household hazardous waste collection facility, provides recycled water for landscape irrigation, and promotes pollution prevention through various educational, informational and inspection programs. It serves nearly half a million residents and over 3,000 businesses over 145 square miles in central Contra Costa County. Central San is operated by 280 employees and a five-member elected Board of Directors.