HILTON HEAD ISLAND, S.C. (November 6, 2013) – Hilton Head Public Service District (PSD) had its AA+ rating with stable outlook on its general obligation bonds affirmed Tuesday by Standard & Poor’s Ratings Services. S&P cited the PSD’s “very strong finances and low-to-moderate debt” and Hilton Head Island’s “well-established, tourism-centered” economy as key reasons for the affirmation. S&P also highlighted the PSD’s “rapid” debt amortization, as the utility plans to retire 79 percent of its general obligation debt over the next 10 years.
General obligation bonds are secured by the PSD’s property tax revenue. They have been used by the utility to fund long-term water supply projects such as the construction of Hilton Head’s first-ever Aquifer Storage & Recovery (ASR) well in 2011 and the PSD’s Reverse Osmosis (RO) Drinking Water Treatment Facility in 2009.
The ASR well stores treated surface water that the PSD purchases at a less-expensive wholesale rate in the winter months of low demand. The well then withdraws and retreats 2 million gallons of water a day in the summer months of higher demand when the wholesale rate is more expensive.
The RO facility treats brackish groundwater into fresh tap water, currently providing 3 million gallons of water a day, about half of the PSD’s average daily demand. The PSD currently is eyeing an expansion of the RO facility’s treatment capacity to allow it provide 4 million gallons of water a day.
Both the ASR well and RO facility have been key tools in the PSD’s fight to replace water supply lost as a result of ongoing saltwater intrusion into the freshwater Upper Floridan Aquifer.
Hilton Head PSD is the public drinking water, wastewater treatment, and recycled water utility serving more than 19,000 customers in the north- and mid-island areas of Hilton Head Island.