Bangkok--3 Dec--Standard & Poor's
Standard & Poor's Ratings Services assigned its 'AA+' rating to Las Vegas Valley Water District, Nev.'s $349 million limited-tax general obligation (GO) water bonds, series 2009C (taxable direct-pay Build America Bonds), and $71 million limited-tax GO water and refunding bonds, series 2009D. At the same time, Standard & Poor's affirmed its 'AA+' long-term rating and underlying rating (SPUR) on the district's outstanding GO bonds, and its 'AA+' issuer credit rating (ICR) on the district. The outlook is stable.
"The rating is based on the district's generally strong financial management, including maintenance of strong cash reserves," said Standard & Poor's credit analyst Paul Dyson. "Moreover, despite recent rate increases, we believe the district has plenty of headroom for additional rate increases, if necessary, under its current rate structure, which provides water to customers at some of the lowest rates among large western cities."
The district is issuing the series 2009C bonds to provide the balance of funding necessary to complete its Intake No. 3 Project, a third deep water intake in Lake Mead. Series 2009D bond proceeds will be used to fund capitalized interest for three years and to restructure the 2010-2012 maturities of the district's outstanding 2003B bonds. The district intends to issue the series 2009C bonds as Build America Bonds under the American Recovery and Reinvestment Act and to annually receive a cash subsidy from the U.S. Treasury equal to 35% of annual interest costs.
The district operates and maintains the Southern Nevada Water System as agent for the Southern Nevada Water Authority (SNWA). Members of SNWA include the district, the City of Boulder City, the City of Henderson, the City of Las Vegas, the City of North Las Vegas, Big Bend Water District, and the Clark County Water Reclamation District. The district encompasses more than 99% of Clark County's tax base and serves all but a fraction of the county's 2.1 million residents, or about three-fourths of the state's 2.7 million residents.
RELATED RESEARCH
USPF Criteria: "GO Debt," Oct. 12, 2006
USPF Criteria: "Key General Obligation Ratio Credit Ranges — Analysis Vs. Reality," April 2, 2008
USPF Criteria: "Standard & Poor's Revises Criteria For Rating Water, Sewer, And Drainage Utility Revenue Bonds," Sept. 15, 2008
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Media Contact:
David Wargin, New York (1) 212-438-1579,
[email protected]
Analyst Contacts:
Paul Dyson, San Francisco (1) 415-371-5079
Ian Carroll, San Francisco (1) 415-371-5060