Moody's Investors Service said it has assigned a Aa3 rating to the city of Dover, Del.'s Water and Sewer Enterprise's $6.22 million water and sewer revenue bonds, Series 2013, and upgraded the rating on the enterprise's $2 million of parity revenue bonds outstanding to Aa3 from A1.
The bonds are secured by net revenues of the combined water and wastewater system. Proceeds of the current issue will be used to redeem the enterprise's $2 million of outstanding revenue bonds for estimated net present value savings of 4%, and raise approximately $4 million to fund infrastructure to serve the Garrison Oak Technical Park. The park is home to a solar electric generation facility and an electric utility, both of which will require significant water usage and wastewater treatment.
The upgrade to Aa3 reflects strong debt service coverage resulting from a sequence of rate increases over the past few years, a moderate debt burden, and a solid financial and operational management characterized by multi-year planning and a series of strong policies. The rating also incorporates a moderately sized but stable and growing customer base that benefits from a significant presence of government, military, and other stable institutions.