EID Water Board Works the Problems
Two problems that EID's Board of Directors is struggling to solve are the cost of recent rate increases and the predicted oncoming drought. Last summer rang with the clamor of unhappy ratepayers that saw repeated increases in their service rates. Although these increases were foreseen years earlier, most people did not appreciate the changes until it came in the form of an increased bill. But that issue has taken a side stage as the failure of thirst quenching rains to help repair our multi year rainfall shortage. As the rain stayed away, the real threat of a summer drought elicited warnings and actions by the EID Board.
Last Tuesday night both Sheriff John D'Agostinin and EID Board member George Osborn were seen at a Tea Party meeting during an meet-n-greet period. But soon after the meeting started Osborn was invited to the mic. Even though he was on his own time his message was water. He noted that we have not seen the needed cutbacks on water consumption after the last call for savings. He explained the dire circumstances we face, and he warned that rather than rain, we see 1-2 weeks of warm sunny weather ahead. He reiterated the need to redouble our efforts to save water.
After he stepped down one person said, "Remember when you got scolded by your Grandpa? You would feel bad, but also warm and loved. George is a good Grandpa," referring to EID Boad of Director George Osborn.
Earlier that same day EID issued a press release outlining the results of a bond refinancing effort approved by the Board.
"Bond Refinancing Saves $17.2 Million, Reduces Outstanding District Debt by $11.4 Million" was the headline of a story that read:
During its March 10, 2014 meeting, the EID Board of Directors received an update on the success of the District’s recent bond refinancing. EID Director of Finance Mark Price noted that the results of the February 13, 2014, bond refinancing were outstanding. “The results exceeded all of our expectations in reduction of debt as well as net present value savings,” he said.
The District reduced its outstanding debt as a result of this bond refinancing by $11.4 million and saw a present value savings of $17.2 million.
“EID’s track record in the capital markets has been stellar,” said Dave Houston, managing director and head of the water group at Citigroup Global Markets. “In the first 20 minutes, we generated more orders than we had bonds available.”
Prior to the transaction, EID staff met with both rating agencies, Moody's Investors Service and Standard & Poor's Ratings Services, to discuss the Preliminary Official Statement in preparation for the agencies to issue their ratings on the bonds. As a result, Moody's issued an A1 rating with a stable outlook and Standard & Poor's issued an A+ with a stable outlook. “These ratings show that EID is a safe and secure investment and this good news bodes well for the District,” said Houston.
“This is a tremendous savings for EID and our ratepayers—$17 million saved in refinancing the debt is huge,” said Board President Alan Day.
“We have a really solid financial plan,” said General Manager Jim Abercrombie. “You can see that in the market and in the savings to our ratepayers. Going forward we need to focus on the financial plan and make sure it is sound and continues to meet the debt service coverage.”