$60 Million Utility Bond Sale to Modernize Water and Wastewater Systems – MargateNews.net

Report on the City of Margate’s Series 2025 Utility Revenue Bond Issuance

Introduction: Strategic Investment in Sustainable Infrastructure

The City of Margate is undertaking a significant infrastructure modernization initiative through the proposed issuance of the Series 2025 Water and Wastewater Improvement Revenue Bonds, not to exceed $60 million. This financing is a strategic measure to upgrade critical utility systems, directly aligning the city’s development with key United Nations Sustainable Development Goals (SDGs). The project aims to enhance public health, ensure environmental compliance, and build resilient infrastructure for the community’s future.

Alignment with Sustainable Development Goals (SDGs)

This bond issuance and the subsequent projects represent a direct local implementation of global sustainability targets. The initiative makes substantial contributions to the following SDGs:

• SDG 6: Clean Water and Sanitation: This is the primary goal addressed. The project is designed to ensure the availability and sustainable management of water and sanitation for all residents.
  • Modernizing wastewater treatment facilities directly supports Target 6.3 by improving water quality and increasing the proportion of safely treated wastewater.
  • Replacing aging distribution pipes ensures progress toward Target 6.1, which aims for universal access to safe and affordable drinking water.
• SDG 9: Industry, Innovation, and Infrastructure: The project focuses on building resilient, reliable, and sustainable infrastructure.
  • By upgrading obsolete systems with modern technologies, the city is advancing Target 9.4, which calls for upgrading infrastructure to make it sustainable and resource-efficient.
• SDG 11: Sustainable Cities and Communities: The improvements enhance the safety and resilience of Margate’s urban infrastructure.
  • Reinforcing the water and wastewater systems reduces the risk of system failures and environmental hazards, contributing to a more resilient community as outlined in Target 11.5.
• SDG 3: Good Health and Well-being: The initiative is fundamental to protecting public health.
  • By removing asbestos concrete pipes and ensuring high-quality water treatment, the project directly supports Target 3.9, which seeks to reduce illnesses from water pollution and contamination.

Project Scope and Key Objectives

The proceeds from the Series 2025 Bonds will finance a multiyear portfolio of critical infrastructure projects. The primary objectives are:

1. To replace obsolete rotating biological contactors at the West Wastewater Treatment Plant, improving treatment efficiency and reliability (SDG 6, SDG 9).
2. To modernize overall plant operations with updated and environmentally sound treatment technologies (SDG 9).
3. To rehabilitate facility headworks and increase overall treatment capacity to meet current and future demand (SDG 6, SDG 11).
4. To replace small-diameter distribution pipes, including those made of asbestos concrete and cast-iron, to safeguard public health and reduce water loss (SDG 3, SDG 6).

Financial and Governance Framework

The financing structure is designed to be fiscally responsible and transparent, ensuring long-term sustainability without burdening taxpayers.

• Bond Structure: The bonds are structured as revenue bonds, meaning repayment is secured solely by the revenues generated from the water and wastewater system, not by property taxes or the city’s general fund.
• Financial Feasibility: An independent feasibility report confirms that the utility system’s projected net revenues are sufficient to cover all operating expenses and the new annual debt service payments through at least 2030, while maintaining rates below the EPA’s affordability threshold.
• Sale Method: A negotiated sale, led by Hilltop Securities, was selected to broaden investor participation and secure favorable interest rates.
• Transparency and Compliance:
  • U.S. Bank Trust Company will serve as the paying agent and registrar.
  • Digital Assurance Certification will act as the dissemination agent, ensuring ongoing financial reporting and material event notices are provided to the market via the Municipal Securities Rulemaking Board’s system.

Conclusion: Fostering a Resilient and Sustainable Community

The City of Margate’s $60 million bond issuance is a forward-looking investment in essential public services. By modernizing its water and wastewater infrastructure, the city is not only addressing immediate operational needs but is also making a firm commitment to achieving long-term public health, environmental protection, and economic stability. This initiative strongly aligns with the principles of the Sustainable Development Goals, positioning Margate as a responsible steward of its public assets and ensuring that critical services remain reliable, affordable, and sustainable for its residents.

Sustainable Development Goals (SDGs) Analysis

1. Which SDGs are addressed or connected to the issues highlighted in the article?

The article on the City of Margate’s utility bond sale directly addresses or connects to the following Sustainable Development Goals (SDGs):

• SDG 6: Clean Water and Sanitation – This is the primary SDG addressed, as the entire project is focused on modernizing water and wastewater systems to ensure the provision of clean water and effective sanitation for the community.
• SDG 9: Industry, Innovation, and Infrastructure – The project involves a significant financial investment to upgrade and build resilient infrastructure, which is a core component of this goal. The focus is on improving the quality and reliability of essential public utility infrastructure.
• SDG 11: Sustainable Cities and Communities – By improving essential services like water and sanitation, the project contributes to making the city more resilient, sustainable, and safe. It ensures that basic services are reliable, which is fundamental for a sustainable community.

2. What specific targets under those SDGs can be identified based on the article’s content?

Based on the details provided in the article, the following specific SDG targets can be identified:

1. Target 6.1: Achieve universal and equitable access to safe and affordable drinking water for all.
   • The article explains that the project includes replacing “small diameter distribution pipes that include asbestos concrete and cast-iron materials.” This action directly contributes to ensuring the safety of the drinking water supply. Furthermore, the article explicitly mentions affordability, stating that the “combined water and wastewater bill remains below affordability thresholds recognized by the Environmental Protection Agency.”
2. Target 6.3: Improve water quality by reducing pollution… and substantially increasing the proportion of safely treated wastewater.
   • The project aims to modernize the city’s wastewater treatment capabilities by “replacing obsolete rotating biological contactors at the West Wastewater Treatment Plant” and implementing “updated treatment technologies.” These upgrades are designed to improve the quality of treated wastewater, thereby reducing pollution and protecting public health.
3. Target 9.1: Develop quality, reliable, sustainable and resilient infrastructure… to support economic development and human well-being.
   • The article’s central theme is the $60 million investment to finance “major repairs and upgrades to the city’s aging utility infrastructure.” The stated goals are to “reinforce system reliability,” reduce the “risk of system failures,” and support “economic development,” which aligns perfectly with the objective of developing reliable and resilient infrastructure.
4. Target 11.5: Significantly reduce… economic losses… caused by disasters, including water-related disasters.
   • By proactively upgrading aging infrastructure, the city aims to “reduce the risk of system failures, environmental violations, and costly emergency repairs.” These system failures, such as major pipe bursts or treatment plant breakdowns, can be considered small-scale water-related disasters. Investing in resilience mitigates the potential for such events and their associated economic and social costs.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

Yes, the article mentions or implies several indicators that can be used to measure progress:

1. Financial investment in infrastructure:
   • The article explicitly states the value of the bond offering is “not to exceed sixty million dollars.” This amount serves as a direct indicator of the financial resources allocated to water and sanitation infrastructure.
2. Proportion of population using safely managed drinking water services:
   • The project’s goal of replacing “asbestos concrete and cast-iron materials” in pipes is a measurable action. An indicator would be the length or percentage of the pipe network replaced with safer materials, which contributes to the safety of the water supply.
3. Affordability of water and sanitation services:
   • The article provides a clear indicator by stating that the “combined water and wastewater bill remains below affordability thresholds recognized by the Environmental Protection Agency.” Progress can be measured by tracking this metric over time.
4. Proportion of wastewater safely treated:
   • The upgrades, such as “replacing obsolete rotating biological contactors” and increasing “treatment capacity,” are actions that directly impact the quality and quantity of treated wastewater. An indicator would be the measurement of treatment plant efficiency and compliance with regulatory standards post-modernization.
5. Service reliability and reduction in disruptions:
   • The goal to “reinforce system reliability” and “reduce the risk of system failures” implies indicators such as the frequency and duration of service interruptions, the number of pipe breaks, and a reduction in emergency repairs.

4. Summary Table of SDGs, Targets, and Indicators

Source: margatenews.net