Bangkok--28 Feb--Standard & Poor's
Standard & Poor's Ratings Services assigned its 'AA+' rating to Everett, Wash.'s pro forma $51 million series 2011 water and sewer revenue bonds. In addition, Standard & Poor's affirmed its 'AA+' rating on the city's water and sewer revenue bonds outstanding. The outlook is stable.
Bonds are secured by a lien and charge on the net revenues of the water, sewer, and stormwater utility (the system).
"The rating reflects our view of the system's location within the metropolitan Seattle service area, with above-average incomes; and ample water supplies and treatment capacity," said Standard & Poor's credit analyst Adam Torres. Also supporting the rating is our view of the system's pattern of very strong liquidity levels and an informal minimum liquidity policy; and history of strong debt service coverage ratios.
We understand that proceeds will fund water and sewer capital improvement projects, including replacing sections of water transmission lines.
The stable outlook reflects Standard & Poor's view of the system's track record of generating strong debt service coverage and a multiyear planning approach that we think supports forecasts of continued strong operating performance relative to pro forma debt service requirements during the next two years. Although we believe that the planned draws on available liquidity would increase the system's exposure to unanticipated costs, we still consider a 90 days' operations minimum as representing a good level. Moreover, we anticipate that strong margins, should they continue, combined with limited capacity pressures, would provide the system sufficient flexibility to quickly rebuild liquidity levels should a disruption occur.
RELATED CRITERIA AND RESEARCH
USPF Criteria: Standard & Poor's Revises Criteria For Rating Water, Sewer, And Drainage Utility Revenue Bonds, Sept. 15, 2008
Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.
Media Contact:
Ana Sandoval, New York (1) 212-438-5095,
[email protected]
Analyst Contacts:
Adam Torres, New York (1) 212-438-2481
Paul Dyson, San Francisco (1) 415-371-5079