The Fayetteville Public Works Commission on Wednesday approved a resolution to issue $295 million in revenue bonds, the proceeds of which will fund improvements to PWC’s electric, water and sanitary sewer systems.
The bonds will be secured by the net revenue of PWC’s electric, water and sanitary sewer systems.
Carolyn Justice-Hinson, a PWC spokeswoman, told CityView that the public utility last sold bonds in 2021, netting about $95 million. That funding was used mostly for replacing and rehabilitating PWC’s water and wastewater infrastructure, according to a PWC statement in November 2021.
“We typically issue bonds every few years and anticipate a two-year cycle for issuing bonds going forward based on needs identified in our capital improvement plan,” Justice-Hinson said. “PWC issues bonds to fund projects, materials and equipment to maintain reliable utility services.”
The bond resolution, which passed unanimously, also provides PWC with the ability to refinance its 2014 bonds “if the market conditions are favorable,” Justice-Hinton said.
The $295 million allocation plan includes:
- $32 million to purchase of electric transformers.
- $16 million to rebuild PWC electric substations.
- $14 million to build solar farms. PWC currently has one (1 MW) solar farm at the Butler-Warner Generation Plant.
- $32 million to continue water/wastewater distribution and collection system reliability and rehabilitation projects.
- $60 million for utility installation for Phase V annexation areas.
- $6 million to begin updating the water treatment process at the PO Hoffer and Glenville Lake Water Treatment facilities to meet pending Environmental Protection Agency regulations for PFAS.
The cost of these projects will not impact customer rates in the future, having already been accounted for by rate increases that went into effect on May 1, Justice-Hinson said. She added that PWC expects to get a good interest rate for the bonds once sold.
“PWC has high bond ratings and has had positive responses with previous bond issuances,” she said. “The last time we issued bonds, we were able to do so at the lowest financing rate ever.”
The 2021 bonds had an interest rate of 2.27%, according to the 2021 statement.
The Fayetteville City Council, which already approved the PWC’s application to sell the bonds, is expected to approve the bond sale at its meeting on Sept. 25. Fayetteville and PWC work closely in the bond process.
Contact Evey Weisblat at eweisblat@cityviewnc.com.
