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Exhibit MSD 67B - Moody's Water and Sewer Utilities 2019 Outlook ReportU.S. PUBLIC FINANCE OUTLOOK 5 December 2018 TABLE OF CONTENTSGrowing revenue will strengthen debtservice coverage in 2019 2 Ample liquidity allows systemsto meet ongoing operations andunexpected costs 4 Capital infrastructure needs willaccumulate 4 Systems will continue to increaserates but accelerating capitalinvestment will require expansion oflow-interest financing options 6 What could change the outlook 8 Moody’s related publications 9 Analyst Contacts Ryan Patton +1.312.706.9954 Associate Lead Analyst ryan.patton@moodys.com Rachel Cortez +1.312.706.9956 Senior Vice President/Manager rachel.cortez@moodys.com Naomi Richman +1.212.553.0014 Senior Vice President naomi.richman@moodys.com Alexandra S. Parker +1.212.553.4889 MD-Public Finance alexandra.parker@moodys.com » Contacts continued on last page Water and sewer utilities - US 2019 outlook stable as debt service coverage strengthens but capital needs rise Our stable outlook indicates our expectations for the credit conditions driving the US water and sewer utility sector over the next 12-18 months. Water and sewer utilities' revenue growth will continue to strengthen debt service coverage and liquidity, helping maintain our stable outlook. The healthy trends will enable most municipal utilities to meet operating costs. However, significant capital needs continue to accumulate as the rate of investment remains low. While there are regional differences and variations by system, customer rate increases and expansion of low-interest financing options will be critical for utilities to sufficiently address deferred maintenance, or capital investment needs will persist. »Growing revenue will strengthen debt service coverage in 2019. Systems continue to increase rates, as many utilities benefit from independent rate-setting authority and healthy economies. With growth in net revenue outpacing debt service costs, annual coverage will continue growing and reach a median well above 2.0x debt service. Debt service coverage is stronger in the Southern and Western regions of the US. »Ample liquidity allows systems to meet ongoing operations and unexpected costs. Liquidity will likely top a median of 450 days cash on hand in 2019, a very healthy level. Cash on hand provides flexibility to address unexpected shocks or capital needs and can allow for a phase in of moderate rate increases. »Capital infrastructure needs will accumulate. Anticipated capital needs are large relative to revenue, and the rate of investment is expected to remain low. Deferring maintenance can lead to higher operating costs and greater expenses down the road. »Systems will continue to increase customer rates, but accelerating investment will require expansion of low-interest financing options. Systems will boost rates, but a funding gap will continue between estimated needs and low-interest state revolving fund (SRF) loans. Funding through the federal Water Infrastructure Innovation Act (WIFIA) helps but still leaves systems with insufficient funding to fully address capital needs. »What could change our outlook. Slower revenue growth, a decline in debt service coverage or liquidity, or rising fixed costs and leverage for local governments that crowd out capital investment could lead to a negative outlook. Alternatively, an increase in capital investment, combined with stronger debt service coverage and liquidity ratios, could lead to a positive outlook. This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE This outlook represents our forward-looking view on credit conditions in the sector over the next 12-18 months. This sectorwide outlook, however, does not imply the likelihood or direction of rating actions for individual issuers. Growing revenue will strengthen debt service coverage in 2019 With increasing net revenue, annual debt service coverage for municipal water and sewer utilities will continue growing to reach a median well above 2.0x debt service in 2019 (see Exhibit 1). Recent improvements in debt service coverage are driven by growing net revenue outpacing relatively stable debt service costs (see Exhibit 2), a trend we expect to continue over our outlook period of the next 12-18 months. Utilities typically maintain rates that are more than sufficient to support operations and debt service. Many systems enjoy independent rate-setting authority. Strong debt service coverage provides flexibility for systems to manage rate increases, build cash reserves or fund pay-go capital projects. While strong coverage is credit positive for the sector, it would likely weaken if systems fully met their capital needs (see discussion below), and therefore it may not be sustainable in the long run. Exhibit 1 Debt service coverage to strengthen in 2019 Median annual debt service coverage (x) for water and sewer utilities 1.50 1.60 1.70 1.80 1.90 2.00 2.10 2.20 2.30 2011 2012 2013 2014 2015 2016 2017 2018* 2019*Median debt service coverage*ProjectedSources: Moody's Investors Service, audited financial statements of rated enterprises Utility rate increases and overall system revenue increases are aided by a growing economy. Our Macroeconomic Board reports that real annual GDP growth averaged 2.2% over the past five years and is on pace to reach 2.9% in 2018. Growth is forecast to continue in 2019, but at a slower pace of 2.3%. Real annual growth in water and sewer system revenue averaged 2.5% between 2010 and 2016. Among the 50 largest systems (by debt outstanding), the median annual rate increase was 4% in 2017 and 2018. Most of these systems report similar increases are already in place for 2019 and 2020. A strong economy makes rate increases more palatable for customers and more essential for systems seeking to offset inflationary growth in expenses. This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history. 2 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Exhibit 2 Growth in net revenue will continue to outpace debt service costs Median growth, indexed to 2010 0.0x 0.2x 0.4x 0.6x 0.8x 1.0x 1.2x 1.4x 1.6x 1.8x 2010 2011 2012 2013 2014 2015 2016 2017 2018* 2019* Net revenues Debt service *Projected. Modest growth in debt service based on assumed issuance of new debt with annual debt service costs greater than that of maturing debt. Sources: Moody's Investors Service, audited financial statements of rated enterprises While debt service coverage is generally improving across the sector, the degree of improvement varies by system type, region and size. Coverage for sewer systems tends to lag behind water and combined water and sewer systems (see Exhibit 3). Sewer systems operate under stringent regulations for treatment plants and tend to have relatively high debt service payments associated with borrowing to comply with environmental consent decrees. Treatment needs for water systems can vary depending on the quality of the water source but are generally less intensive. Debt service coverage is strongest in the Southern and Western US based on regional medians data. Systems in these regions generally benefit from population growth and tend to have newer infrastructure than systems in the Northeast and Midwest. Coverage is notably weaker in the Midwest and Northeast regions where many systems are confronting declining customer bases and rising maintenance costs. Nationwide, smaller systems tend to have weaker coverage. Exhibit 3Coverage varies across categories but is generally improving Median annual debt service coverage (x) by system type, region and size 2011 2012 2013 2014 2015 2016 2017 7-year trend Type Water 1.87 2.05 2.04 1.96 1.87 2.03 2.01 Sewer 1.64 1.69 1.75 1.82 1.88 1.83 1.94 Combined 1.86 1.89 1.85 1.85 1.91 2.07 2.23 Region Northeast 1.39 1.43 1.47 1.56 1.58 1.56 1.70 Midwest 1.72 1.90 1.87 1.81 1.78 1.85 1.90 South 1.86 1.85 1.82 1.83 1.91 2.08 2.21 West 2.11 2.17 2.27 2.23 2.09 2.14 2.32 Size (O&M) Less than $1 million 1.72 1.93 1.81 1.74 1.75 1.67 1.78 $1-$3 million 1.75 1.87 1.90 1.79 1.77 1.93 2.01 $3-$10 million 1.77 1.83 1.81 1.86 1.87 1.96 2.11 $10-$30 million 1.90 1.97 2.00 1.98 2.01 2.13 2.18 $30-$65 million 1.87 1.88 1.85 1.96 1.93 2.13 2.31 Over $65 million 1.72 1.76 1.80 1.82 1.86 1.85 2.04 “Size” based on operations and maintenance (O&M) expenses. Sources: Moody's Investors Service, audited financial statements of rated enterprises 3 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Water and sewer systems are closely connected to municipalities Many water and sewer systems are owned and operated by municipalities. The local governments often have budgetary and rate-setting authority over the enterprises, with cash sometimes flowing between the general government and the utility. The lack of independence is the primary reason why ratings on debt secured by water and sewer revenues are typically within two notches of the local government's general obligation (GO) rating. Positive or negative credit trends for utilities can impact the credit quality of the associated local governments, and the direction can flow the other way as well. We recently revised our outlook to negative on the City of Madison, Wisconsin's Aaa GO rating due in part to weakness in the Madison Water Enterprise (Aa2 negative). More severe stress at the Jackson, Mississippi Water and Sewer Enterprise (Ba2 negative) prompted a downgrade of the City of Jackson (Baa3 negative). The city provided the enterprise with an emergency loan from its general fund in order to meet an upcoming debt service payment. In times of financial stress, local governments may also look to water and sewer systems as a resource to support general governmental operations by seeking financial transfers above levels already in place. In extreme cases, local governments have sold their water or sewer systems to investor-owned utilities to provide budgetary relief or pay down debt or pension obligations. Pennsylvania cities Scranton and McKeesport have both sold their utilities to Pennsylvania-American Water Company (A3 stable) in recent years. Scranton used the sale proceeds from its sewer system to reduce debt, while financially strained McKeesport intended to use sale proceeds to shore up its financial position. Ample liquidity allows systems to meet ongoing operations and unexpected costs Liquidity is expected to top a median of 450 days cash on hand in 2019, an extremely strong level (see Exhibit 4). Cash on hand provides an important buffer for systems to address unexpected shocks, phase in rate increases or fund immediate capital needs. We project liquidity will rise in 2019, although cash will generally remain insufficient to fully fund long-term capital needs (see discussion below). Growth in liquidity is driven by a strong economy and increasing revenue, but the trend also reflects some deferral of infrastructure investment. Ample coverage on annual debt service expense allows systems to generate surpluses, and given that the rate of infrastructure investment remains low, many systems are using the surpluses to build cash reserves. Exhibit 4 Liquidity is steadily improving across the sector 0 50 100 150 200 250 300 350 400 450 500 2011 2012 2013 2014 2015 2016 2017 2018* 2019*Median days cash on hnad*Projected Sources: Moody's Investors Service, audited financial statements of rated enterprises Capital infrastructure needs will accumulate While strong debt service coverage and liquidity better equip systems to meet immediate operating challenges, we expect large capital needs to accumulate as the rate of infrastructure investment generally remains low. Local capital investment for water and sewer 4 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE systems has not kept pace with operating and maintenance (O&M) expenses for decades and declined following the Great Recession (see Exhibit 5). This trend corresponds with weak federal spending on water and sewer infrastructure, which peaked in the 1970s and has since gradually declined. US Census Bureau data reflected a modest uptick in real capital spending by local utilities in 2015 and 2016. Still, capital spending remains just half of total operating expenses. Exhibit 5 Local capital investment will remain low $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 BillionsReal O&M expense Real capital expense Adjusted to real 2016 dollars using GDP price index. O&M stands for operations and maintenance.Sources: US Census, US Bureau of Economic Analysis Our measure of asset condition — remaining useful life — has also been declining for the past 10 years, further suggesting that systems are not reinvesting at a rate sufficient to offset annual depreciation expenses. Reinvesting at the rate of depreciation is generally a low bar for utilities given that many aging assets, particularly water and sewer mains, are already fully depreciated and replacement costs grow substantially over the long useful lives of these assets. Recent analysis by the Congressional Budget Office (CBO) shows that annual inflation rates for construction materials have generally outpaced the inflation rate for the overall economy over the past 60 years. The CBO also reports that the actual amount of infrastructure labor and materials purchased (based on an index) by water and sewer utilities declined 7% in 2016, despite a budgetary increase of 8%. The CBO estimates an additional 11% decline in the amount of infrastructure labor and materials purchased in 2017. Given that water and sewer utilities are highly dependent on infrastructure for service delivery, maintaining sound infrastructure is a critical need. Deferring maintenance can lead to higher operating costs and greater expenses down the road. System-reported capital needs are significant relative to revenue, largely due to aging infrastructure. The US Environmental Protection Agency's (EPA) most recent assessment of drinking water infrastructure needs, released in March 2018, reports an estimated $473 billion over the next 20 years. The estimate represents a 10% increase from the prior assessment released in 2014, driven by a growing need to replace aging pipes and water mains, which now account for $313 billion of the reported need.1 Sewer systems anticipate infrastructure needs of $271 billion over the next 20 years, based on the EPA's most recent assessment of clean watersheds needs released in 2016. Capital needs for sewer systems primarily consist of treatment ($102 billion), sewer mains and conveyance ($96 billion), and combined sewer overflow correction ($48 billion). Taken together, the combined needs of water and sewer utilities amount to $744 billion or a high 6.4x revenue for the entire sector. Strong debt service coverage across the sector is tempered by limitations on the ability of net revenue to support accumulating capital needs. Spread evenly over the next 20 years, the implied annual need of $37 billion is nearly double our estimate of $20 billion in revenue available to support new debt service.2 Borrowing the full 20-year need of $744 billion today (at a notional 4.0% interest for 30 years) would reduce coverage to below 0.7 times annual debt service, barring any customer rate increases (see Exhibit 6). Even borrowing the five-year need could bring coverage down to roughly 1.25x annual debt service. 5 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Exhibit 6 Borrowing for accumulated capital needs would likely weaken debt service coverage, absent customer rate increases Estimated debt service coverage if varying amounts were borrowed today; sector debt service coverage median is 2.0x $744 $340 $205 $115 $48 $0 $100 $200 $300 $400 $500 $600 $700 $800 0.63x 1.0x 1.25x 1.50x 1.75xCapital borrowing (billion)Estimated coverage Full 20-year need 9-year need 5-year need 3-year need Estimated based on 30-year borrowing at 4.0% interest and existing coverage of 2.0x. Sources: US Census Bureau, US Environmental Protection Agency, Moody's Investors Service Adapting to environmental risks Environmental risks stemming from rising temperatures and more frequent severe weather events, such as heavy rainfall, drought and wildfires, will generally be manageable for most systems but could affect credit quality in the medium to long term. Nevertheless, we expect systems will continue to evaluate environmental risks and make plans to adapt. Large municipal water and sewer systems continue to invest in combined sewer overflow (CSO) correction plans to divert untreated sewage from waterways during heavy rainfall events, often requiring the construction of large underground storage tunnels. The most recent EPA estimate of future capital needs for CSO projects is $48 billion, with the 10 largest outstanding consent decrees for CSO projects totaling $23 billion. Flooding remains a primary concern for local governments. Risk of drought is especially heightened in the West, where careful management of water resources is needed across state lines. The Colorado River system is in a prolonged drought that is projected with high probability to result in reductions in water allocations over the next five years. Positively, the US Bureau of Reclamation and the seven states participating in the Colorado River system (Arizona, California, Colorado, Nevada, New Mexico, Utah and Wyoming) recently released a plan that would improve regional water cooperation and add security and greater certainty to the regional water supply. Systems will continue to increase rates but accelerating capital investment will require expansion of low-interest financing options We expect utilities will continue increasing customer rates to support system maintenance, even if annual capital investment does not fully cover the estimated needs. Annual rate increases of 3%-4% will be common and will allow utilities to maintain strong debt service coverage while addressing some repairs and gradually funding certain long-term replacement projects. Technologies that identify sources of water leakage or extend the life of pipes will better equip systems to prioritize capital needs. Fully financing the EPA-estimated needs on an annual basis would require more substantial rate increases. We estimate that annual customer rate increases of 6%-7% would be required to support annual borrowing of $37 billion at 4% interest and maintain 2.0x coverage over the next five years (see Exhibit 7). Systems in regions with declining populations, such as the Northeast and Midwest, would likely require even higher rate increases. While many utilities benefit from independent rate-setting authority, increasing rates at this pace could be politically untenable as monthly bills would become increasingly burdensome, particularly for low-income households. 6 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Accelerating large-scale capital investment will likely require an expansion of grants or low-interest financing options that reduces the burden on local ratepayers. We estimate that $37 billion in annual capital investment at 0% interest under such financing options would lower required rate increases to a more attainable 3%-5% over the next five years. Exhibit 7 Consistent customer rate increases are needed to maintain existing debt service coverage and fully address capital needs With borrowing at 4% interest, 6%-7% annual rate increases required to maintain 2.0x debt service coverage 1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Year 0 Year 1 Year 2 Year 3 Year 4 Year 5Growth in net revenues (indexed)2.0x coverage with borrowing at 4% interest 2.0x coverage with borrowing at 0% interest Annual rate increases of 6%-7% Annual rate increases of 3%-5% Estimated based on annual borrowing of $37 billion with 30-year term and various interest rates.Sources: US Census Bureau, Environmental Protection Agency, Moody's Investors Service State revolving fund loans are the primary mechanism for grants and low-interest financing, but available funding is limited. Congress appropriates roughly $2 billion annually to the revolving funds, and each state provides a 20% match on dollars received. Inclusive of loan amounts repaid and available to support further lending, the CBO estimates that state revolving funds provide roughly $8.8 billion for new projects annually. Keeping water and sewer rates affordable Major capital investment often requires hefty rate increases, which can strain or even discourage low-income customers from paying monthly water bills. The City of Philadelphia Water and Sewer Enterprise (A1 stable) raised its water rates by 50% over the past 10 years to support replacement of aging infrastructure and environmental compliance. Faced with a high number of delinquent water bills and uncollected revenue, the city recently changed its water rate structure to a progressive framework in which rates are based on earnings. Lower rates are charged to households with incomes at or below 150% of the federal poverty line. Participating households will pay between 2% and 4% of their monthly income for water service. While there remains limited guidance on water affordability, the EPA suggests that combined water and sewer bills exceeding 4.5% of median family income are unaffordable. New funding provided through the federal Water Infrastructure Finance and Innovation Act (WIFIA) shows promise for expanding access to low-cost infrastructure financing. WIFIA allows the EPA to provide low-interest loans and loan guarantees to cover up to 49% of large infrastructure and water reuse projects, with utilities or states responsible for the remaining 51%. WIFIA's key feature, however, is that it stimulates large capital investments with relatively low cost to the federal government. The most recent federal appropriation for water infrastructure provides $25 million in annual funding through WIFIA. The $25 million budget authority will allow the EPA to provide $1.6 billion in credit assistance and stimulate as much as $3.2 billion in total infrastructure investments.3 While this amount is still only a fraction of the estimated $37 billion annual need, it will allow some systems to pursue needed infrastructure projects by reducing any required rate increases. Future increases in WIFIA appropriations could help accelerate infrastructure investment. 7 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE What could change the outlook Slower revenue growth, a decline in debt service coverage or liquidity, or rising fixed costs and rising leverage for local governments that crowd out capital investment could change the outlook to negative. Alternatively, an increase in capital investment combined with healthy coverage and liquidity ratios could change the outlook to positive. 8 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Moody’s related publications Outlooks »Global Macroeconomic Outlook (2019-20): Global growth to decelerate amid tightening global liquidity and elevated trade tensions, November 8, 2018 »Cross-Sector - Global: 2019 Outlook - Global credit conditions to weaken amid slowing growth and rising risks, November 12, 2018 »Local government - US: 2019 outlook remains stable with tax revenue to grow modestly, December 5, 2018 Sector Comment »State revolving funds - US: Federal legislation to boost funding for state revolving funds, a credit positive, October 31, 2018 »Environmental utilities - US: Colorado River water plan highlights strength of regional management, seriousness of drought, October 18, 2018 Medians »Water and sewer utilities - US: Medians - Solid financial metrics, ability to raise rates underpin stable sector, April 5, 2018 9 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Endnotes 1 The latest EPA estimate remains lower than the $1 trillion estimate published by the American Waterworks Association in 2012, partly because the EPA excludes needs related to population growth and covers 20 years instead of 25 years. 2 Our estimate of $20 billion is calculated by applying a 2.0x debt service coverage derived from our rated systems to net revenue reported by the Census for all systems. 3 Because federal budget appropriations cover only the subsidy cost of the loan (representing the presumed default rate on WIFIA loans of about 2%), WIFIA can be leveraged at a ratio greater than 50 to 1. 10 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. 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(“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively. MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it fees ranging from JPY200,000 to approximately JPY350,000,000. MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements. REPORT NUMBER 1145857 11 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's. MOODY'S INVESTORS SERVICE U.S. PUBLIC FINANCE Contributors Daniel Simpson +1.312.706.9965 Analyst dan.simpson@moodys.com CLIENT SERVICES Americas 1-212-553-1653 Asia Pacific 852-3551-3077 Japan 81-3-5408-4100 EMEA 44-20-7772-5454 12 5 December 2018 Water and sewer utilities - US: 2019 outlook stable as debt service coverage strengthens but capital needs rise This document has been prepared for the use of Heather McNamara and is protected by law. It may not be copied, transferred or disseminated unless authorized under a contract with Moody's or otherwise authorized in writing by Moody's.