CHICAGO — Standard & Poor's has revised its outlook to positive on Whiting, Wis.'s BBB-minus rating citing new practices in place to ensure it will keeps up to date on debt service payments.
"The outlook revision reflects our view that we will likely raise the rating if management maintains its enhanced debt monitoring system to avoid future debt defaults," said Standard & Poor's analyst John Kenward in a Nov. 19 report.
The village is struggling with what the rating agency's views as very weak management. The village missed its Sept. 2, 2014, interest payment on promissory notes, making the payment seven days late. It was made within the rating agency's five-business-day grace period following the payment.
Whiting's unlimited-tax, full-faith-and-credit GO pledge secures the promissory notes.
"We believe that the late payment was due to an oversight by management rather than an unwillingness to support the village's obligations," analysts said.
After the late debt payment, the village clerk set up a calendar with several debt service payment date reminders to prevent future delinquencies. The village also hired a deputy clerk last August to assist with monitoring debt payments. The village has not missed payments since.
"Although we recognize that management has improved its ability to track the village's debt service payments, until it shows more consistency in maintaining its enhanced debt monitoring system, the rating is capped" at its current level, Standard & Poor's said.
