Investing in clean water
Wastewater infrastructure is crucial for protecting water quality and economic vitality, and supporting jobs and growth while maintaining our region’s natural assets like beaches, lakes and rivers.
King County's wastewater utility is entirely funded by the ratepayers who invest in our programs and services through their monthly rate and capacity charge bills. We take seriously our obligation to provide the highest levels of service and accountability to our ratepayers.
Bond ratings
Standard & Poor's and Moody’s investor services are leading global financial firms that rate corporate stocks and municipal bonds according to risk profiles.
- King County Sewer Enterprise parity revenue bonds ratings of Aa1 from Moody’s Investors Services (Moody’s) and AA+ from Standard and Poor’s (S&P) Global Ratings were affirmed in June 2020 and December 2020, respectively.
- Water Quality’s ratings on its limited tax general obligation bonds of Aaa from Moody’s and AAA from S&P were both affirmed in October 2019.
These continued favorable credit ratings lower the cost of borrowing by reducing interest payments to bondholders, which, in turn, reduces impacts to the rate.
Financial statements
The wastewater utility undergoes an annual audit to insure that its annual financial results are fairly stated and that all covenants with the utility’s bondholders have been met. The audited financial results are here.
Revenues
King County’s adopted wastewater budget for 2021 includes about $417.3 million in revenue from the monthly sewer rate and $92.9 million in revenue from the capacity charge. The 2021 budget also includes about $4.5 million from investments and $18.5 million from other income such as fees for industrial waste permits and septic waste processing.
King County issues bonds to fund a portion of the cost of construction projects within the capital improvement program.
Biennial budget (2021-2022)
- Operating budget: $347 million
- Capital budget: $679 million
How the WTD Capital Improvement Program (CIP) is funded
The WTD CIP is funded through a combination of debt (long-term revenue bonds and state loans) and cash transfers from the operating fund that include capacity charge revenues.
The operating fund derives the majority of its revenue from monthly charges to sewer customers that are collected by WTD's component agencies.
Transfers from the operating fund to the capital program are based on the financial practice of cash-funding 40 percent of the capital program. This practice results in a debt service coverage ratio in recent years of approximately 1.50 on all debt payments, so that operating revenues, after payment of operating expenses and debt service, provide net cash flow equal to 50 percent of the total debt service expense. This buffer reduces risk to bondholders, lowers WTD’s borrowing costs and is used to pay for the capital program.
| 2023 | |
|---|---|
| County's wholesale monthly sewer rate | $52.11 |
| *Monthly capacity charge | $72.50 |
| *Listed rates are for 1 residential customer equivalent (RCE) per month. Capacity charge rates go into effect for new sewer hook-ups on or after January 1 each year. | |
Related content
Summary of Estimated COVID-19 Revenue Impacts to the Wastewater Treatment Division (WTD) , September 10, 2020