Bangkok--25 Jun--Standard & Poor's
Standard & Poor's Ratings Services raised its underlying rating (SPUR) on Cheyenne, Wyo.'s water revenue refunding bonds outstanding to 'AA' from 'AA-'. The outlook is stable.
"We base the upgrade on our view of the system's strong financial performance and management, leading to strong debt service coverage and liquidity," said Standard & Poor's credit analyst Timothy Barrett.
The rating also reflects what we see as the system's status as a regional trade center, coupled with a government center as the state capital and service-based economy; and affordable rates despite frequent adjustments.
"The stable outlook reflects our expectation that system officials will continue their timely rate increases and that management will sustain its financial operations and maintain satisfactory debt service coverage," Mr. Barrett added. Significant customer concentration currently precludes a higher rating in view.
Offsetting factors in our opinion include the system's customer concentration with the 10 leading customers accounting for 41% of total water revenues and the leading ratepayer accounting for 16%.
A first-lien net revenue pledge of Cheyenne's water system secures the bonds, which will be on par with the series 1998 bonds and state loans outstanding from the Wyoming Water Development Commission. All future state loans will be on par with the series 2007 bonds.
The water system serves a population of about 58,182 with about 21,800 water customers primarily in Cheyenne ('AA' general obligation debt rating).
RELATED RESEARCH
--"Location, Location, Location: What Does It Mean For My Community's Rating?," April 22, 2008
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Timothy Barrett, New York (1) 212-438-6327
David G Hitchcock, New York (1) 212-438-2022
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
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