Fitch Affirms DSRSD's 'AA' Rating on Water Revenue Bonds

From Dublin San Ramon Services District:

Fitch Ratings affirmed Dublin San Ramon Services District’s ‘AA’ rating on $35.1 million water revenue bonds (series 2011), saying the district is financially sound and the rating outlook is stable. The bonds are secured by revenues from the district’s water system.

“We plan well and take a long-term view so we are able to set our rates and fees to appropriately fund our capital improvement program,” says DSRSD Board President D.L. (Pat) Howard. “All our investments and rates are based on the full cost of service and clearly defined standards.”

Key Rating Drivers
Since 2010, the district has had a sound financial profile, with reserves of at least 1.8 times the cost of annual debt service. Fitch expects similar results through the district’s current financial forecast period ending in 2021.

Fitch notes the district’s rate structure is favorable and affordable relative to median household income.

The district has had healthy finances for the prior six fiscal years, in part because it has reduced reliance on connection fees. In addition, DSRSD’s liquidity levels have continued to tick up, with $53.5 million in cash, or 846 days cash on hand, at fiscal year-end 2015.

DSRSD has a manageable five-year capital plan (estimated cost of $35.4 million for water replacement and expansion projects), which the district expects to fund on a pay-as-you-go basis. Longer-term projects will focus on the development of additional water supplies to meet future demand and address system upgrades.

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