California Water Service Group enters new credit agreement

California Water Service Company receives new revolving credit limit, allowing for easily accessible funding in case of needed fixes throughout the water group

SAN JOSE, CALIF. – As California Water Service Group enters into a new credit agreement, it won’t directly impact CalWater’s Visalia district. But Visalians can rest easy knowing their needs are taken care of if anything were to go wrong.

California Water Service Group (Group) announced that it has entered into unsecured revolving credit facilities for Group and its subsidiaries totaling $600 million for a term of five years. Of the total, $400 million is available to California Water Service Company (Cal Water), a wholly owned subsidiary of Group and company who facilitates Visalia’s water utilities. The remaining $200 million will be available to Group and the subsidiaries other than Cal Water. According to Tom Smegal, Cal Water’s chief financial officer, this new line of credit gives them the opportunity to fix issues in a timely manner without having to worry about funding immediately.

“It should give our customers in Visalia the confidence that we can go out and raise money at any time to fix problems in the system, to make repairs, to make investments, to improve reliability and water quality,” Smegal said. “There shouldn’t be any worries about our ability to finance these things.”

Currently in Visalia, Smegal said they are working on two large capital improvement projects, both million gallon storage tanks. Construction should begin in a few months on the most recent project. It will be  adding a one million gallon storage tank, booster pump station and 16 foot pipeline on East Acequia Avenue just east of downtown. In addition to that, Smegal said there is an additional project in the design process, with construction to follow either later this year or next. It will be another one million gallon storage tank and booster pump station. This one will be located at McAuliff Street and Race Avenue to add peaking supply at the current well station. Smegal said there are additional small projects and other projects not as far along as well.

Additionally, the credit facilities may be expanded up to an incremental $150 million under the Cal Water facility and up to $50 million under the Group facility, subject to certain conditions. The proceeds from the credit facilities may be used for working capital purposes, including short-term financing of capital investments pending longer-term financing for those investments. The credit facilities replace the prior Group and Cal Water unsecured revolving credit facilities.

“Our company provides water service throughout California and in several other western states,” Smegal  said. “And what we are generally doing, besides operating the systems in places like Visalia, is that we’re investing in capital improvements in those systems.”

BofA Securities, Inc. acted as sole lead arranger and sole bookrunner, with CoBank and US Bank as syndication agents and Bank of China as documentation agent. Bank of America, N.A. is the administrative agent.

“I was very happy with the commitment shown to California Water Service Group from the banks in our syndication,” Martin A. Kropelnicki, president and chief executive officer of CalWater said. “Despite the current challenges in the banking sector, given our strong credit rating from Standard & Poor’s and with the strength of our balance sheet, we believed the time was right to replace the existing credit agreement with a new agreement that would extend our terms for an additional five years.”

California Water Service Group is one of the largest regulated water utilities in the western United States. It provides high-quality, reliable water and/or wastewater services to more than 2 million people in California, Hawaii, New Mexico, Washington and Texas through its regulated subsidiaries, California Water Service, Hawaii Water Service, New Mexico Water Service, and Washington Water Service, and its utility holding company, Texas Water Service.

What sets Group apart is its commitment to enhancing the quality of life for its customers, communities, employees, and stockholders. Guided daily by their promise to provide quality, service, and value, Group’s 1,100+ employees lead the way in working to protect the planet, care for people, and operate with the utmost integrity. Integral to Group’s strategy is investing responsibly in water and wastewater infrastructure, sustainability initiatives, and community well-being. The company has been named one of “America’s Most Responsible Companies” by Newsweek and a Great Place to Work®. More information is available at

Start typing and press Enter to search