Utah Power Agency Outlook Improves: Moody's

DALLAS — Moody's Investors Service has raised the outlook on Utah Municipal Power Agency's A2 rating to stable from negative ahead of a $21.5 million revenue bond sale.

"The stable outlook takes into consideration improvement in the agency's financial performance since increasing member rates beginning 2011," Moody's analyst Scott J. Solomon wrote in his Oct. 18 report.

UMPA's ratio of pledged revenues to debt service fell below 1 in 2009 and 2010 but improved to 1.05 in 2011 and to 1.2 last year, with further improvement expected this year, Solomon said.

UMPA's A2 rating is based in part on the credit profile of its six municipal members, the agency's independent rate setting ability, and improved financial performance, according to Moody's.

The City of Provo, which accounts for 60% of total revenue and more than 65% of revenue from members, carries a Moody's rating of Aa1 for general obligation bonds and A1 for electric utility bonds.

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