A key agency has issued a strong credit rating for Miami-Dade’s upcoming bond sale to finance repairs to its antiquated water and sewer system. But Moody’s Investors Service also warned that if the county doesn’t hike user rates as planned, the rating could slip.
Miami-Dade is preparing to issue nearly $445 million in bonds to help pay for pipe fixes required by a federal mandate. The county already has $1.8 billion in outstanding water and sewer bonds, whose rating Moody’s downgraded by a notch on Friday — to Aa3 from Aa2 — to match the rating on the new bond issue.
The agency noted that Miami-Dade has low water rates, a robust population and room to grow its customer base — all positive signs for potential lenders.
But the average water user is not wealthy, Moody’s report noted, and Miami-Dade will be required to invest heavily to repair its leaky pipes, requiring an “aggressive” borrowing program and politically unpopular rate hikes.