Standard & Poor's Ratings Services said it raised its rating on Atlanta's outstanding water and wastewater revenue bonds to AA-minus from A-plus.
At the same time, it assigned a AA-minus rating to the city's series 2015 water and wastewater revenue refunding bonds.
The outlook is stable.
"The higher rating reflects a number of positive credit factors," said Standard & Poor's credit analyst James Breeding, "specifically the recent and projected trend of strong coverage and liquidity, coupled with the ability to cash fund a large portion of the capital improvement plan for the next five years."
"The rating reflects our assessment of recent strong financial performance, including high coverage, which city management projects will remain so," he added.
Other factors include: a large and diverse retail and wholesale water and wastewater customer base; currently very high liquidity levels, though much of this will be used for capital projects; the previous passage of multiyear rate increases needed to meet higher debt service costs, together with voter reauthorization of the Municipal Options Sales Tax (MOST) to further support system operations; and significant progress in addressing consent and administrative orders, coupled with an extension of the First Amended Consent Decree (FACD) completion date to 2027 (which alleviates some of the near-term financing needs), along with clarity regarding the long-term viability of the city and region's raw water supply. However, there has been recent court action that adds a level of uncertainty to this issue.
