Otay Saves Customers $5.6M Through Refinancing
The Otay Water District is pleased to announce that it has successfully refinanced the District’s 2007 Certificates of Participation (COPs), saving District customers $5.6 million.
In 2007, the District issued $42 million in COPs to construct reservoirs, pump stations, and pipelines. The outstanding principal on those COPs is $34,760,000. The remaining 2007 COPs bear interest at an average coupon rate of 4.28% and mature on September 1, 2036.
On April 26, 2016, the District accepted a competitive winning bid from JP Morgan which effectively refinanced the District’s 2007 COPs at 2.48%, resulting in debt service savings of $269,721 annually to customers. Total savings over the life of the 2007 COPs is $5,664,140.
“We are very pleased to generate these cost savings and to pass them on to the customers of the Otay Water District,” said Mitch Thompson, President of the District’s governing board. “Always looking for ways to keep rates low for our customers is part of our commitment to prudent fiscal management of the District.”