Standard & Poor's Ratings Services said it has raised its rating on Plainfield Town, Ind.'s sewage works revenue-backed debt to AA-minus from A-plus.
At the same time, it assigned its AA-minus rating to the system's 2012 sewage works refunding revenue bonds. The outlook is stable.
"The upgrade reflects our view of the system's maintenance of strong financial performance, which includes strong debt service coverage and liquidity," said Standard & Poor's credit analyst Corey Friedman.
The AA-minus rating reflects the system's: recent history of strong debt service coverage and strong liquidity levels, based on the town's financial consultant provided accrual-basis statements; low debt to plant ratios with no additional debt plans; and consistent customer growth reflecting a service area that benefits from its participation in the diverse Indianapolis metropolitan area economy and proximity to the Indianapolis International Airport.
Somewhat offsetting these strengths are a moderately concentrated customer base combined with permissive legal provisions.
The town's sewage system net revenue pledge secures the bonds. Bond proceeds will refund the series 1999A, 2003A, and 2003B bonds for interest cost savings.
The stable outlook reflects the expectation that the sewage system will continue to generate its good financial coverage and maintain at least strong liquidity, especially as it addresses various capital needs. The town's participation in the Indianapolis metropolitan area economy provides further rating stability.
During the current two-year outlook period, the rating agency does not expect to raise the rating further. Downward rating pressure would occur if the system's financial position, which is reliant on the financial consultant providing its accrual-based statements, were to significantly deteriorate without immediate corrective action to ameliorate such deterioration.
