City sewer bond ratings upgraded

By Vicki Grudzinski

A city sewer bond rating upgrade and favorable interest rates will mean a break for City of Portland sewer ratepayers. This week, the city’s Bureau of Environmental Services refinanced more than $207-million of outstanding debt. That means a savings of $2.24-million annually in debt repayments through 2015.

The bond sale follows last week’s announcement that both Moody’s Investors Service and Standard & Poor’s Corporation upgraded the city’s sewer bond ratings. Moody’s upgraded the city’s first lien sewer system revenue bonds from A1 to Aa3. Standard & Poor’s upgraded the bond ratings from A+ to AA.

The rating agencies cited Environmental Services’ strong management, successful completion of the West Side CSO Project, and reduced risks in the bureau’s capital program as reasons for the upgrades. The upgraded bond ratings will reduce the bureau’s borrowing costs as it implements its capital program over the next five years.

“This is great news for both our capital construction program and our sewer ratepayers,” said Sam Adams, the City Commissioner in charge of Environmental Services. “We have an aging sewer system in
Portland, and we need continued support to replace and repair older pipes and to expand the system to serve a growing population,”
Adams said.

Bond proceeds pay for capital improvements, including sewer projects to control combined sewer overflows (CSOs). The city will have spent an estimated $1.4-billion on the program when CSO construction is finished in 2011.

Portland’s sewer system serves more than 560,000 residents. Projected capital improvement program requirements through 2012 total $714 million. CSO projects account for 79% of that total.

The Bureau of Environmental Services provides city residents with Clean River programs including, water quality protection, wastewater collection and treatment, and sewer installation.