Bangkok--5 Jan--Standard & Poor's
Standard & Poor's Ratings Services raised its underlying rating (SPUR) two notches to 'A' from 'BBB+' on Trinity County Public Utility District, Calif.'s outstanding electric revenue bonds. The outlook is stable.
"The raised rating reflects our view of the district's consistently strong and stable financial and operating performance, and substantial financial flexibility in the form of low rates, rate surcharges, and contingency reserves," said Standard & Poor's credit analyst Paul Dyson.
In our view, the district's financial performance has been consistently strong and stable for several years, with senior DSC at no less than 2.6x since 2004 and coverage of all debt service at no less than 2.2x. Senior DSC is forecasted at no less than 3.9x through fiscal 2013, with combined coverage of senior- and junior-lien debt at 2.6x-3.0x. Based on estimated cash on hand in the district's contingency reserve of approximately $1.6 million, or about 90 days' cash, as of June 30, 2008, we consider liquidity to be healthy.
In 2003, the district implemented a rate surcharge to mitigate growth in power costs, including those for purchased power and California Independent System Operator transmission charges. Its drought relief surcharge, adopted in 2007, also serves to bolster cash flow and coverage in the case of a prolonged below-average water scenario.
Trinity County Public Utility District serves 7,080 customers (90% of Trinity County) with annual sales of more than 90,000 megawatt-hours. It is the only public power agency with a full allocation from Western Area Power Administration.
Complete ratings information is available to subscribers of RatingsDirect, the real-time Web-based source for Standard & Poor's credit ratings, research, and risk analysis, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Credit Ratings Search.
Media Contact:
Edward Sweeney, New York (1) 212-438-6643, [email protected]
Analyst Contacts:
Paul Dyson, San Francisco (1) 415-371-5079
Alexander M Fraser, Dallas (1) 214-871-1406