Standard & Poor’s last week upgraded Kansas City’s water revenue bond program to AA-plus from AA, citing the system’s improved financial position and maintenance of good liquidity levels as the city addresses a $260 million capital plan.
The city this summer plans to sell about $206 million of water revenue bonds in a deal that shift the system over to a more modern bond covenant program.
The credit benefits from a strong and diverse service-area economy and moderate rates, with timely rate increases when needed, according to analysts. Kansas City’s role as a regional economic center provides stability for the rating.
“We expect that the system will continue to produce strong debt service coverage and maintain sufficient liquidity as it addresses its capital needs,” analyst Corey Friedman wrote in the upgrade report.
The system provides service to about 157,000 predominately residential customers, using a combination of surface water from the Missouri River and ground water from a well field.