Strong bond ratings, favorable interest rates mean stable monthly sewer bills for King County ratepayers

Ratepayers will see stable monthly sewer bills in the coming months thanks to strong bond ratings and favorable interest rates that will minimize the cost of borrowing to fund King County’s sewer improvement projects.

K ing County’s Wastewater Treatment Division sold $250 million in bonds last week to pay for more than a dozen vital sewer improvement projects now underway or planned for 2007 and early 2008.

In May, both major bond rating agencies maintained the strong ratings of King County wastewater bonds.  Moody's Investor's Service assigned an A1 rating to the agency's revenue parity bonds, unchanged from last year.  Standard & Poor’s maintained the county’s upgraded ‘AA’ rating issued in 2006.

Factors both firms cited in issuing the high bond ratings include:

• Strong management practices
• Continued positive financial performance
• Strong economy, solid rate base, and large service area
• Commitment to capital improvement plan

The high bond ratings and stable outlook were assigned with the expectation the county will continue its present management practices.

Each year, King County's wastewater utility borrows money to fund its capital improvement program by selling sewer revenue bonds. Higher bond ratings help the county secure a lower interest rate on its bonds, which are paid back through current and future monthly sewer rates and charges.

The County Council voted on May 29 to hold monthly sewer rates at $27.95 in 2008 and increase the capacity charge from $42.00 to $46.25, which is 7.5 percent below last year's projections.

Strong bond ratings are especially critical as King County expects to borrow nearly $1 billion over the next three years to fund sewer improvement projects needed to serve population growth and maintain the sewer system infrastructure.

The Wastewater Treatment Division’s proposed capital spending is $320 million in 2007 and $443 million in 2008.
People enjoy clean water and a healthy environment because of King County's wastewater treatment program. The county’s Wastewater Treatment Division protects public health and water quality by serving 17 cities, 17 local sewer utilities and more than 1.4 million residents in King, Snohomish and Pierce counties. Formerly called Metro, the regional clean-water agency now operated by King County has been preventing water pollution for more than 40 years.