CONSOLIDATED UTILITY DISTRICT OF RUTHERFORD COUNTY ACHIEVES AAA/STABLE BOND RATING FOR FIRST TIME; SELLS $15 MILLION IN 20 YEAR BONDS
(Murfreesboro, TN)….November 9, 2009…For the first time in its 40-year plus history, the Consolidated Utility District (CUDRC) has achieved a AAA/Stable rating from the Standard & Poor’s rating service, the highest rating available to public entities.
Standard & Poor’s, in a credit profile on Consolidated Utility, cited several reasons for bestowing its AAA/Stable rating, including CUDRC’s “strong senior-lien and total annual debt service coverage, its strong liquidity position, its low debt burden and its economically strong service area.”
“We are very pleased to achieve this highest rating ever for our bonds,” said Larry McElroy, General Manager of CUDRC. “This is a real tribute to the hard work of our Board of Commissioners, our management team and all our employees to help us be recognized in this way. And it will pay off for our customers, as our AAA/Stable rating means a more favorable interest rate on our bonds.”
This AAA/Stable rating was awarded as CUCRC prepared for the sale of $15 million in 20-year bonds. The proceeds will help to refinance the utility’s previous debt which was used to improve its system which serves almost 43,000 customers in Rutherford County. The bond monies will also be used to provide additional capital for ongoing projects.
The bonds were sold at a competitive sale with the assistance of Stephens, Inc., investment bankers. CUDRC received bids from eight underwriters, with the low bid of 3.68% coming from Wiley Brothers. The results of the sale were reviewed by CUDRC’s staff and approved by Board President John L. Batey, Jr. and Vice President William Waite.
CUDRC is the largest water utility district in Tennessee and now the only one which holds a AAA/Stable bond rating.
The Consolidated Utility District of Rutherford County has almost 43,000 customers and operates a system of over 1,250 miles of water and sewer lines. The Utility is governed by a five-member board appointed by the Mayor of Rutherford County. Since it was formed in 1968, the goal of CUDRC has been to provide safe drinking water to all households and businesses within its service area which includes rural areas of Rutherford County and some customers and businesses in Murfreesboro and Smyrna.