AWWA JAW6714
Journal AWWA - Funding Improvements With Debt Capital and Revenues
Journal Article by American Water Works Association, 09/01/1982
Marshall, W.N.
Full Description
Water utilities, especially those with low bond ratings, can fund capital improvements with a combination of debt capital and revenues. The optimum amount of new debt to be contracted at a single bond sale for a construction program extending over n years is equal to a portion (K1) of total capitalization during that interval diminished by a portion (nK1K2) of existing maximum debt service. The cash coverage factor and the number of years required for completion of a construction program are more influential than interest rates in determining the optimum amount of long-term debt to issue. Includes table, figures.