Dover, Del., 2003 Water Revs Raised to AA by Fitch

Fitch Ratings said it upgrades Dover, Del., $2.9 million water and sewer refunding revenue bonds, series 2003 to AA from AA-minus.

The rating outlook is revised to positive from stable.

The bonds are secured net revenues of the city's combined water and sewer system (the system) and impact fees.

The upgrade reflects a demonstrated trend of solid financial performance following two years of double digit rate increases. Debt service coverage (DSC) is forecast to remain strong at over 2.6x through 2017 and liquidity is a solid 345 days of cash on hand (DCOH).

Debt levels are exceptionally low and likely to remain at a manageable level given the system's limited capital needs and additional issuance plans.

Despite recent increases system rates retain ample flexibility and register well below Fitch's affordability threshold. Only modest additional increases are presently forecast.

Some concentration among large customers exists, although this concern is largely mitigated by the stability of each of the largest users.

The system provides retail service to a diverse and important service area that functions as both the state capital and county seat.



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