Up to $560 million of bonds approved for Oklahoma dam authority

Oklahoma’s Council of Bond Oversight approved up to $560 million of revenue bonds Thursday for the state’s Grand River Dam Authority (GRDA), which is expected to start issuing the debt later this year.

Proceeds will finance repairs and improvements, including a natural gas-fired generating unit to replace the authority’s last remaining coal-fired unit, as well as a possible refunding of its 2014 Series A and B bonds for savings, according to Alexandra Edwards, Oklahoma’s deputy treasurer for debt management.

“The authorization is expected to be sold in two series, with the first series scheduled for later this year,” she said in an email.

The state legislature created the authority in 1935 as a conservation and reclamation district for the Grand River. It is Oklahoma’s largest public power utility and is funded with revenue generated from electricity and water sales. GRDA officials did not return phone calls.

The authority had nearly $823 million of bonds outstanding from issues sold in 2010, 2014, 2016, and 2017, according to its latest annual comprehensive financial report.

Ahead of a proposed refunding last year of the 2014 bonds, GRDA’s ratings of A1 from Moody’s Investors Service, A-plus from Fitch Ratings, and AA-minus from S&P Global Ratings were affirmed. The refunding did not take place, according to Fitch, and there is no posting for the deal on the Municipal Securities Rulemaking Board’s EMMA disclosure website. 

The rating agencies noted $102 million in costs GRDA incurred during February 2021’s Winter Storm Uri, when natural gas prices spiked, and the authority’s plan to recover those costs from customers over 10 years.