CALIFORNIA, MD – The first Debt Capacity Study of MetCom since 1999 was released at the April 21, 2015 meeting of the Commissioners of St. Mary’s County. The study by Davenport Public Finance, a firm which provides financial and underwriting services to the public as well as for not for profit issuers in the Mid-Atlantic region, including St. Mary’s County, gave MetCom a positive report.
The Davenport study compared MetCom customer costs favorably against similarly sized peers across the United States. The details examined in the financial and debt profile of MetCom costs were based these key points: outstanding long term debt per customer, annual combined customer bill versus median household income, operating margins, debt service coverage, and cash liquidity. MetCom scored well in each of these areas and Davenport commented that MetCom’s debt profile was strong, in part due to its “strong operations and management.”
Further strengthening the findings demonstrating MetCom’s solid debt profile, is that its customer base is smaller than comparable peer utilities resulting in lower customer costs even though those total costs are distributed among fewer rate payers.
Davenport concluded that MetCom operates “at a level consistent with a solid AA rated Utility Enterprise Operation.” Further, due to MetCom’s “strong financial, management and debt track record,” the utility has the capability to explore potentially more efficient and flexible financing mechanisms as well as possibly issuing standalone bonds to finance projects.
The Executive Summary for MetCom begins on page four of the study.