The Massachusetts Water Resources Authority issued $445.5 million in bonds to refund previously issued securities.
The authority sold the bonds in two series. The 2024 Series B bonds, consisting of $166.3 million, mature between 2025 and 2049, yielding between 3.02% and 3.9%. The 2024 Series C bonds, consisting of $279.3 million, mature between 2027 and 2042, yielding between 3.02% and 3.58%. All of the bonds pay interest at 5%. The securities received a rating of AA+ from Fitch Ratings, Aa1 from Moody’s Investors Service, and AA+ from S&P Global Ratings.
“The Aa1 rating reflects the strong credit profile of the authority’s members and service area, very stable but limited debt service coverage, and satisfactory liquidity bolstered by strong fiscal management and excellent rate setting history,” Moody’s analysts wrote.
The authority will use the issuance proceeds to refund commercial paper notes that it issued in 2016 and bonds that it sold between 2016 and 2021. The water authority says that refunding issuances like these allow it to manage the rate increases it levies on its member communities.
The Massachusetts Water Resources Authority provides water and sewer services to more than 3 million people in the greater Boston area, according to its website. The bonds are general obligations of the authority, backed by its full faith and credit.
Barclays Capital Inc served as lead underwriter on the issuance, purchasing the bonds for $500 million. The price reflected a premium of more than $55 million. PFM Financial Advisors LLC acted as municipal advisor.