Consolidated Utility reaches highest rating on The Murfreesboro Post

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Consolidated Utility reaches highest rating

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Posted: Monday, November 9, 2009 10:31 am

For the first time in its 40-year plus history, the Consolidated Utility District (CUDRC) has achieved a AAA/Stable rating from the Standard & Poor’s rating service, the highest rating available to public entities.

Standard & Poor’s, in a credit profile on Consolidated Utility, cited several reasons for bestowing its AAA/Stable rating, including CUDRC’s “strong senior-lien and total annual debt service coverage, its strong liquidity position, its low debt burden and its economically strong service area.”

“We are very pleased to achieve this highest rating ever for our bonds,” said Larry McElroy, General Manager of CUDRC. “This is a real tribute to the hard work of our Board of Commissioners, our management team and all our employees to help us be recognized in this way. And it will pay off for our customers, as our AAA/Stable rating means a more favorable interest rate on our bonds.”

This AAA/Stable rating was awarded as CUCRC prepared for the sale of $15 million in 20-year bonds. The proceeds will help to refinance the utility’s previous debt which was used to improve its system which serves almost 43,000 customers in Rutherford County. The bond monies will also be used to provide additional capital for ongoing projects.

The bonds were sold at a competitive sale with the assistance of Stephens, Inc., investment bankers. CUDRC received bids from eight underwriters, with the low bid of 3.68% coming from Wiley Brothers. The results of the sale were reviewed by CUDRC’s staff and approved by Board President John L. Batey, Jr. and Vice President William Waite.
CUDRC is the largest water utility district in Tennessee and now the only one which holds a AAA/Stable bond rating.

The Consolidated Utility District of Rutherford County has almost 43,000 customers and operates a system of over 1,250 miles of water and sewer lines. The Utility is governed by a five-member board appointed by the Mayor of Rutherford County. Since it was formed in 1968, the goal of CUDRC has been to provide safe drinking water to all households and businesses within its service area which includes rural areas of Rutherford County and some customers and businesses in Murfreesboro and Smyrna.

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Member Opinions:

By: brucer16 on 11/9/09
They should have the best bond rating because they charge more for water than anyone else in the county and make more profit from it. Lower interest rates should equal lower water rates, but not for CUD. It's the biggest ripoff in the county. They need to lower their rates.

Here are the rates for cities and CUD in Rutherford County. This does not include sewer charges. Based on 5,000 gallons usage:

Smyrna: $13.11 ($6.75 for 1st 2,000 gallons, $2.12 for each additional 1,000 gallons.)

La Vergne: $16.90 ($9.52 for 1st 2,000 gallons, $2.46 for each additional 1,000 gallons.)

Murfreesboro: $21.02 ($8.22 for 1st 200 cubic feet, $2.74 per additional 100 cubic feet water. 100 cubic feet equals 750 gallons.)

CUD: $32.95 ($13.78 for 1st 2,000 gallons, $6.39 for each additional 1,000 gallons.)

By: Farmall on 11/10/09
The biggest complaint I have about CUD is their billing. You get a bill and its due in as little as seven days, late fee applies after that. Then they call and threaten to turn the water off. And this has happened, bill comes after I left, I come back to a cut off call, I was only gone 11 days. Oh yeah their rates are high to.

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