The New York City Municipal Water Finance Authority intends to sell $375 million of second resolution, fixed-rate tax-exempt new money bonds on Wednesday, after a one-day retail order period.
M.R. Beal & Co. will be the book-running senior manager. Barclays, Citigroup, Ramirez & Co. and Raymond James will be co-senior managers.
Fitch Ratings and Standard & Poor's rate the bonds AA-plus, while Moody's Investors Service assigns an equivalent Aa2 rating.
"[New York Water's] primary credit strength is its legal structure, including its status as a bankruptcy-remote issuer, providing substantial protection to bondholders from potential operating risks associated with the system and the city," Fitch said in a report. "Strong financial management and a proven ability and willingness to independently raise rates are reflected in consistently solid financial results, despite the continued volatility in consumption."
The bonds are special obligations, secured by a subordinate lien on gross revenues.
New York Water issued $2.3 billion in long-term bonds in fiscal 2013 for capital projects and refinancing purposes, city comptroller John Liu said in his comprehensive annual financial report, issued last week. Of that amount, $1.4 billion was new money and about $900 million for refunding. Additionally, the authority issued $315 million in bond anticipation notes.
Capital projects are listed in the city's capital plan. The Department of Environmental Protection administers them.
As of June 30, according to Liu, New York Water had just under $25 billion of debt, including general obligation and second resolution bonds. Also as of June 30, the authority had $423 million of bond anticipation notes outstanding that were issued to the New York State Environmental Facilities Corp. According to Liu's report, the authority plans to replace the BANs with long-term debt in 2014.