LOS ANGELES — Moody's Investors Service on Dec. 8 upgraded Clovis, Calif., wastewater revenue bonds to A2 from Baa1 affecting $103 million in outstanding debt.

The bonds are secured by net revenues of the wastewater enterprise located in the state's central valley in Fresno County.

"The upgrade reflects the system's improved financial position supported by multi-year rate increases which includes a bond service charge, very healthy and stable liquidity position, improving economy and strong management team," according to Moody's analysts.

The A2 rating incorporates the system's growing service area supported by a recovering economy, above average wealth, a very strong liquidity position and below-average debt service coverage.

Strengths cited by analysts include a very healthy liquidity position that is expected to remain stable and a growing service area that is supported by an improving economy.

The one challenge cited was an above average debt ratio.

Events that could result in an upgrade include maintaining debt service coverage below average, significant improvement of debt service coverage that is sustained over several years and sustained growth of the city, which would allow for greater generation of revenues.

Factors that could result in a downgrade include a deterioration of cash reserves and significant decrease in debt service coverage.

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