Bangkok--24 Dec--Standard & Poor's
Standard & Poor's Ratings Services raised its underlying rating (SPUR) to 'A' from 'A-' on Columbia River People's Utility District, Ore.'s outstanding electric system revenue obligations. The outlook is stable.
"The raised rating reflects the district's strong and improved financial performance, including strengthening debt service coverage ratios and liquidity and a declining debt burden, as well as its limited operating risk as a full preference customer of Bonneville Power Administration," said Standard & Poor's credit analyst Paul Dyson.
Debt service coverage on all obligations, including revenue and general obligation (GO) bonds, hit a 10-year high of 2.3x in 2007, up from 1.9x in 2006 and 1.7 in 2005 and 2004, and coverage of senior revenue bonds alone in 2007 was 5.0x, improving from 4.3x in 2006 and 3.6x in 2005. Projected combined coverage during fiscals 2008 and 2009 is likewise strong at 2.4x and 2.7x, respectively, and when GO bonds are retired in 2010, all-in coverage is likely to approach 6.0x.
The district's cash position has improved significantly as of audited fiscal 2007, reaching an all-time high of $7 million or 112 days' cash of operating expenditures. Per the district's projections, cash levels will increase further to $10.5 million or 169 days' cash for 2008. Liquidity at these levels is, in our opinion, very strong, especially for a distribution-only system. The district had previously set a goal to build cash to $7.5 million by 2010 and will achieve this goal two years ahead of its target.
The district recently signed 20-year power supply contract with Bonneville Power Administration (AA-/Stable), which offers it a reliable, low-cost, clean power resource.
Created in August 2000, the electric system provides service to about 18,314 customers in Columbia County. Columbia County is located just north of Multnomah (home of Portland) and Washington counties.
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Media Contact:
Edward Sweeney, New York (1) 212-438-6643, [email protected]
Analyst Contacts:
Paul Dyson, San Francisco (1) 415-371-5079
Ian Carroll, San Francisco (1) 415-371-5060