The East County Advanced Water Purification Joint Powers Authority plans to issue around $433,235,000 in tax exempt, fixed rate notes on Sept. 4. The East County AWP Project is a collaborative partnership between the City of El Cajon, the County of San Diego, Padre Dam Municipal Water District, and Helix Water District. The project will create a new, local and sustainable drinking water using state-of-the-art technology to purify recycled water in East San Diego County.
The notes are being issued to finance a portion of the design, construction and development costs of the AWP Project. The notes are special, limited obligations of the Authority payable solely from net revenues of the Authority, and, if needed, other funds held by the Authority.
The East County AWP Project is currently estimated to cost $950 million. The Authority has secured two low interest loans – a $378 million, 0.8% SRF Loan with the State Water Resources Control Board and a $388 million, 1.95% WIFIA loan with the Environmental Protection Agency. The Authority has also secured over $76 million in federal, state and local agency grants and incentives as well as an estimated $86 million subsidy from the Metropolitan Water District of Southern California tied to water production. The interim notes will provide immediate funding for project construction while loan disbursement requests are processed and additional, permanent funding sources are secured.
The project will treat a portion of East San Diego County’s wastewater locally, reducing ocean discharge and energy for transportation. In addition, the project will implement indirect potable reuse by producing advanced treated water from the AWP facility, and pumping such treated water to Helix’s Lake Jennings Reservoir for surface water augmentation where it will be blended with local and imported water. The water will then be sent to Helix’s R. M. Levy Water Treatment Plant to become potable water for distribution and use by Helix and Padre Dam. This local water supply is projected to provide up to 30% of East San Diego County’s water demand, offsetting an equal demand for imported water. The Authority is currently evaluating the feasibility of including an energy recovery component for the project which will reduce greenhouse gas emissions in the region.
Notes are being issued in two subseries, one subject to optional and mandatory turbo redemption and the other subject to optional redemption. Final maturity date of the notes is Sept. 1, 2026. The notes have an AA rating by Fitch. Trust Securities is serving as the senior manager for the offering and J.P. Morgan is serving as co-manager.
