Illinois' Grand Prairie Water Commission went to market Monday in a debut deal for the municipal corporation charged with linking Joliet and nearby communities with Chicago's water system.
The $51.2 million Series 2025 senior lien water revenue bonds will kick off construction of a $1.2 billion water transmission system, according to a Credit Insights report by BAM Mutual, which insured the deal.
"I thought it went really well," said Anthony Miceli, senior vice president at municipal advisor Speer Financial, following Monday's pricing. "(The deal had) good follow-through from a lot of different investors… I think this sets a good tone."
JPMorgan priced the deal to yield from 2.99% for the 2034 maturity to 4.66 for the 2055.
The BAM insurance brings a rating of AA with a stable outlook from S&P Global Ratings. Moody's Ratings assigns an underlying rating of A2.
The bond counsel is Katten Muchin Rosenman LLP, according to the preliminary official statement.
Miceli said the team was happy with the timing of the deal. "There was heavy supply last week; we avoided that," he said. "It was pretty quiet all in all."
The bonds are senior lien obligations and limited obligations of the commission, payable from the revenues of the system and certain other moneys and securities held by the trustee under the master trust indenture and first supplemental indenture.
The regional water commission is composed of six municipalities in Will, Kendall and Grundy counties: Joliet, Romeoville, Crest Hill, Channahon, Minooka and Shorewood.
The commission is led by Joliet, which provides management services for the commission and which finalized a 100-year water supply agreement with Chicago in 2023 to buy treated Lake Michigan water starting in 2030, according to an
Joliet began exploring water supply options because the aquifer it draws water from now
Under the terms of the agreement, Chicago agrees to provide treated Lake Michigan water to Joliet through Dec. 31, 2123, up to 105 million gallons per day.
The agreement
Joliet transferred that agreement to the commission in August 2025.
The commission's members signed a master water supply agreement in July 2024 which obligates the commission to sell Lake Michigan water to the members. Each member is in turn obligated to buy all the water necessary to meet its full water requirements from the commission.
Joliet
The project carries some execution risk, with cost overruns and rising system leverage among the potential challenges.
While the commission has limited financial audits, the legal structure for the bonds is solid,
BAM's analysis concluded that water rates should remain affordable even as total outstanding debt increases as the system is built out between now and 2030.
"BAM first evaluated each member community's utility system, which include diverse customer bases, low current rates relative to household income, and strong liquidity positions, and then used conservative assumptions to estimate future rates upon project completion," Juliet Stiehl, co-head of public finance at BAM, said by email.
The Trump administration-induced volatility around federal funding also brings an element of uncertainty to the planned $609.88 million of Water Infrastructure Finance and Innovation Act loans from the U.S. Environmental Protection Agency, which account for 49% of the total project costs.
The administration moved to
"The city has closed on two loans, we're working on third now," said Kevin Sing, Joliet's finance director. "The commission is in the process of (getting) its first loan now… We've not heard of any legislative changes that would impact it."
Joliet will bear 49.38% of the costs of the commission's new system. Romeoville will bear 14.16%, Crest Hill 9.38%, Channahon 9.2%, Minooka 9.06% and Shorewood 8.83%.
The allocated costs are apportioned based on each municipality's share of the system, Sing said.
The commission expects to issue $428.18 million total of revenue bonds toward the project costs.
An additional $120 million of Illinois EPA loans are also part of the funding mix, and $30.8 million will come from other sources.
Jessica Lerner contributed reporting.
