Lakeway MUD scores upgraded bond rating from Moody’s

LAKEWAY, Texas—Once again, the Lakeway Municipal Utility District has received high marks from a bond-rating agency.

Moody’s Investors Service, one of the top bond-rating agencies in the country, upgraded the Lakeway Municipal Utility District’s long-term bond rating to A1 from A2, affecting $7.3 million in outstanding general obligation debt. Moody’s said the upgrade reflects the district’s:

• Strong financial management.
• Solid financial position, with healthy reserve funds.
• Above-average household wealth.
• Modest tax base.
• Modest plans for additional long-term debt.

“Moody’s believes the district’s financial position will remain stable
due to strong financial management with significant revenue raising flexibility and solid reserves,” Moody’s wrote in a report issued April 29.

In its report, Moody’s pointed out that Lakeway MUD benefits from full-time management. Moody’s noted that a full-time management team is unusual for most municipal utility districts in Texas, and “this is a favorable credit factor in the A1 rating assignment.”

Tom Rogers, president of Lakeway MUD’s Board of Directors, said: “The Moody’s bond rating and analysis underscore the MUD’s firm financial foundation. Lakeway MUD customers should be pleased and proud that their money is in good hands.”

On April 10, Lakeway MUD earned an AA-minus rating from bond-rating agency Standard & Poor’s. That rating resulted in Lakeway MUD gaining lower interest rates on $5.87 million in general obligation bonds it sold April 15. Proceeds from the bond sale will go toward improvement of water and wastewater services.

In November 2007, Lakeway MUD voters overwhelmingly authorized the issuance of up to $13.3 million in bonds.