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Commercial Paper Program

In pursuing its mission to finance capital improvements to New York City's Water and Sewer System, the Authority relies on the commercial paper (CP) program as its main source of short-term financing. The Authority utilizes CP to reimburse the City for amounts advanced in payment for water and sewer projects. The Authority then issues long-term debt to retire the outstanding CP.

The Authority's CP notes are fixed-rate, short-term instruments. The program has grown to $600 million and has established itself as an integral part of the Authority's overall financing plan. The program is divided into three series: 1, 7 and 8. These designations serve to differentiate the different par amounts, dealers, and credit enhancement, where applicable.

The Authority's Series 1 notes are backed by a line of credit from a bank. The Series 7 and Series 8 notes are Extendable Municipal Commercial Paper notes and are not credit enhanced.

Advantages of the Commercial Paper Program

The commercial paper program has several advantages. Issuance of CP can be accomplished relatively quickly and provides the Authority with the maximum flexibility when scheduling its long-term bond issuances. Additionally, CP lowers the Authority's cost of borrowing and amounts drawn can be closely matched to the capital cash flow requirements of the water and sewer system.

Series
Amount
(millions)
Line of Credit Banks
Dealer
Series 1
$ 200

JPMorgan

Barclays Capital

Extendable Municipal Commercial Paper

Series
Amount
(millions)
Line of Credit Banks
Dealer
Series 7
$200
N/A
Goldman Sachs
Series 8
$200
N/A
Goldman Sachs