Agribusiness  August 8, 2022

North Weld Water approves $38M bond issue

LUCERNE — The North Weld County Water District Monday approved a bond issue of up to $38 million, with the funds going toward capital improvements.

Jason Simmons, senior managing director of Hilltop Securities Inc., which the district retained in April to prepare the bond issue, said the district would incur debt payments of about $2.8 million annually, at an anticipated interest rate of 3.5% to 4%. The bonds would have a 20-year maturity.

An offering document for the bond sale will be posted Tuesday, with the bond sale occurring Aug. 17. The district received a credit rating of AA, the same as a 2019 bond issuance.

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“It’s a very solid rating for the district,” Simmons said, adding that, “We expect there to be very high demand for the bonds, given the high rating.”

The board action on Monday authorized District Manager Erik Reckentine to determine and accept the winning bid for the bonds, provided that, among other provisions:

  • The interest rate does not exceed 5%.
  • The principal of the issuance does not exceed $38 million.
  • The total repayment cost does not exceed $58 million.
  • The bonds do not mature later than Nov. 1, 2042.

North Weld’s system is operated as an enterprise, which, under the Taxpayers Bill of Rights, exempts bond issues from requiring voter approval.

The district has several outstanding bonds, including:

  • 2012 bonds, with $13.44 million in original principal and $3 million outstanding, maturing in 2023.
  • 2019 bonds, with $16.16 million in original principal and the same amount outstanding, maturing in 2039.
  • 2020 bonds, with $3.85 million in original principal and $3.45 million outstanding, maturing in 2029.

Reckentine told BizWest that the new bond proceeds will be used to fund construction of the NEWT III pipeline, a new tank at the district’s Tank 1 site and the extension of NEWT III through a two-mile section of Weld County to the tank site.

NEWT III, to be built with the East Larimer County Water District, will extend from North Timberline Road in Fort Collins east into Larimer County, creating additional delivery capacity for the North Weld County Water District, which has had to pause or limit tap and plant-investment sales because of capacity constraints. It will then be extended two miles into Weld County.

The NEWT III pipeline had been stalled because of regulatory issues in Larimer County, which was revising its 1041 regulatory process. 1041 regulations allow local governments control over certain land-use issues.

“We’re hoping to begin construction of NEWT III, end of this year, beginning of next year, and the goal is to have it constructed before the summer of 2024,” Reckentine said.

Once NEWT III is close to completion, the district can begin looking at issuance of additional taps, but how much demand it will be able to meet “is still being analyzed,” he said.

LUCERNE — The North Weld County Water District Monday approved a bond issue of up to $38 million, with the funds going toward capital improvements.

Jason Simmons, senior managing director of Hilltop Securities Inc., which the district retained in April to prepare the bond issue, said the district would incur debt payments of about $2.8 million annually, at an anticipated interest rate of 3.5% to 4%. The bonds would have a 20-year maturity.

An offering document for the bond sale will be posted Tuesday, with the bond sale occurring Aug. 17. The district received a credit rating of AA, the same as…

Christopher Wood
Christopher Wood is editor and publisher of BizWest, a regional business journal covering Boulder, Broomfield, Larimer and Weld counties. Wood co-founded the Northern Colorado Business Report in 1995 and served as publisher of the Boulder County Business Report until the two publications were merged to form BizWest in 2014. From 1990 to 1995, Wood served as reporter and managing editor of the Denver Business Journal. He is a Marine Corps veteran and a graduate of the University of Colorado Boulder. He has won numerous awards from the Colorado Press Association, Society of Professional Journalists and the Alliance of Area Business Publishers.
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