Michigan Department of Treasury

--- PRESS RELEASE ---

For Immediate Release

August 12, 2014 Contact: Terry Stanton, (517) 335-2167
Jeremy Sampson (517) 373-3223
Michigan Finance Authority Approves Detroit Board of Water
Commissioners Financing Proposal
Plan would allow City to Buy Back DWSD Bonds
The Michigan Finance Authority (MFA) today, unanimously approved an authorizing
resolution for a financing in the amount of $5.2 billion for the Detroit Water and
Sewerage Department (DWSD), through the MFA's Local Government Loan Program.
This transaction will allow the DWSD to repurchase bonds it issued in previous years,
as part of a tender proposal the Detroit Board of Water Commissioners (BOWC)
approved last week.
Under the Tender offer, owners of DWSD bonds have been given the opportunity to
voluntarily tender their bonds for repurchase. If the voluntary tender is successful,
DWSD could refinance up to nearly $5.2 billion of system debt. Part of the boards
action also authorized a new money component of approximately $175 million to assist
the DWSD in meeting its capital needs for the coming year.
We are pleased to be able to assist the city of Detroit, and the DWSD in offering a
reasonable and workable solution for everyone involved; from bond holders to the city
of Detroit, and perhaps most importantly, DWSD customers," said Tom Saxton, Chief
Deputy State Treasurer and chair of the Michigan Finance Authority. "Through a
refinancing, the DWSD can lower the interest rate it pays, reduce debt service costs,
and save DWSD customers millions over the next several years."
A refinancing will only occur if there is a successful tender. Bond holders that wish to
sell their bonds back to the City must advise the City in writing by 5:00 p.m. eastern
time, on August 21, 2014.
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