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State Treasurer Fiona Ma announces $1.059 billion revenue bond sale for Department of Water Resources

California State Treasurer Fiona Ma announced the sale today of $1.059 billion in California Department of Water Resources (DWR) Water System Revenue Bonds to finance and refinance certain State Water Project capital improvements and refund certain of DWR’s outstanding Water System Revenue Bonds.

The State Water Project is a statewide complex system of dams, water storage facilities, aqueducts, pumping stations and electric generation facilities that have been constructed by DWR to deliver water and protect against flooding. It supplies water to 29 local water agencies, serving a population of 27 million, or 69% of California’s population.

The bonds were well received by the market. The $544.2 million tax-exempt Series BB bonds received over $1.3 billion in total orders, with $280 million from retail accounts, while the $515.2 million federally taxable Series BC bonds received over $2.6 billion in total orders.

The refunding bonds are expected to save $55.6 million in debt service costs over the next 15 years, or $47.3 million on a present value basis.

The all-in true interest cost is 1.27 percent. The tax-exempt Series BB bonds consist of maturities from 2022 to 2035, with yields ranging from 0.12 percent to 1.00 percent. The federally taxable Series BC bonds consist of maturities from 2020 to 2035, with yields ranging from 0.13 percent to 1.789 percent.

The bonds are rated AAA by Standard & Poor’s and Aa1 by Moody’s Investors Service. The joint senior managers for the sale were Morgan Stanley and Jefferies LLC. The co-senior manager was Cabrera Capital Markets, LLC. Additionally, there were 12 firms participating as co-managers.

A calendar of upcoming state bond sales is available at: BuyCaliforniaBonds.com.

This article was released by the California Treasurer’s Office.