Will save $8.5 million over life of bond
LOUISVILLE, Ky. (Aug. 13, 2014) — Louisville Water has successfully executed a refunding of a 2006 bond issue that will save the company $6.9 million dollars in present value savings, or $8.5 million total gross savings over the life of the bonds.
This morning through a competitive bid process with eleven bidders, Hutchinson, Shockey, Erley & Co., was the winning bidder with a total interest cost of 2.68 percent.
Today’s advance refunding comes on the heels of an “AAA” credit rating from Standard & Poor’s Ratings Services and an “AAA” rating from Moody’s Investors Service, the highest ratings possible.
Louisville Water issued $83.8 million of bonds in 2006 as new money for its capital program. The money primarily funded Riverbank Filtration, advanced treatment technology at the B.E. Payne Treatment Plant and the rebuilding of the Crescent Hill Filtration Plant. While the call date for the bonds is 2016, Louisville Water was able to do an advance refunding, saving 11percent, to take advantage of favorable market conditions.
“Today’s sale is a testament to our sound fiscal management which will save Louisville Water and its customers millions of dollars,” said Amber Halloran, Louisville Water Vice President and Treasurer. “Combined with the recent affirmation of high credit ratings, Louisville Water can continue its investment in its infrastructure and high-quality drinking water at a lower capital cost.”
Currently, Louisville Water holds $242 million in bonds to finance the company’s capital improvement plan.