Better bond rating means millions in savings for Springfield Water and Sewer Commission

The Springfield Water and Sewer Commission, aided by a recent bond rating upgrade from Standard and Poor's Rating Service, has been able to refinance debt and issue new revenue bonds for millions of dollars in long-term savings.

Standard & Poor's improved the commission's rating for the sale of general revenue refunding bonds to "AA Stable" from "AA- with stable outlook," the commission reported.

Grant Davis will run California's largest water agency.

As a result, the commission will realize a present value savings of $2.43 million over the next 12 years as a result of refinancing its past debt, the commission announced in a prepared release.

In addition, the commission has issued a general revenue bond totaling $24.8 million for current and future water and sewer infrastructure projects, reduced to $21.1 million as a result of the bond rating upgrade, the commission reported.

"Our goal was to establish a sound and sustainable financial foundation in order to enable continued investment in our infrastructure while keeping rates affordable and stable," said Joshua D. Schimmel, executive director of the commission.

The commission sells bonds to finance its capital improvement program which includes the water and sewer improvements.

"Financing of infrastructure renewal and rehabilitation projects allows for stable and affordable rates while preserving and protecting public health and safety and meeting regulatory obligations," the commission stated.

Standard & Poor's based the upgrade on the commission's "continue strengthening and formalization of strong financial and operational practices and policies," the commission said.

The commission, in the announcement of the upgrade, stated it "has historically exhibited strong financial operations and stewardship." The upgrade was the eighth bond rating issuance for the commission since it was formed in 1996.

The commission provides drinking water and/or wastewater services to approximately 250,000 customers in Springfield, Ludlow, Agawam, Longmeadow, East Longmeadow, West Springfield, Wilbraham and Southwick.

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