NEW YORK, NY, Dec. 20, 2000 (BUSINESS WIRE) —Citing strong performance and environmental compliance for Raleigh, NC's water and sewer efforts, Fitch has given an upcoming combined enterprise system revenue bond a rating of 'AAA'.
The bonds, scheduled to be sold on or about Jan. 10, are worth about $22,475,000. Serial bonds mature March 1, 2002-2018, and term bonds mature March 1, 2022 and March 1, 2026.
The 'AAA' rating on the City of Raleigh's combined water and sewer system considers the service area's many strengths, the excellent fiscal and operating management of the water and wastewater systems, very strong financial performance, and relatively low, stable rates.
An expected merger with the town of Garner's system, the first step towards regionalizing service in eastern Wake County, should improve the town's compliance with environmental regulations and does not pose foreseeable risk to the Raleigh system. The city's system generated revenue of $50.6 million in fiscal 2000 from service to customers within and surrounding the city and through wholesale contracts with neighboring towns.
Raleigh is the state capital and is adjacent to the highly successful Research Triangle Park (RTP). The city has experienced strong population growth and even more rapid job growth, resulting in a decline in already low unemployment rates for the city from 3.6% in 1993 to 1.6% in 1999. Wealth levels are well above state and national averages, and per capita retail sales are extremely high. The city's general obligation bonds are rated 'AAA.'
The system is in compliance with environmental regulations, and management is proactive with respect to achieving compliance with new regulations for systems dependent on a surface water supply. The balance sheet is healthy. Moderate, growth-related capital plans are projected over the medium and long terms. Debt service coverage is well in excess of conservative legal requirements.
