Moody's Investors Service has downgraded to Baa1 from A3 the city of Ketchum, Idaho's sewer enterprise revenue bonds affecting $1.4 million in parity debt obligations.
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The bonds are secured by the net revenues of the city's sewer system. Concurrently, the negative outlook was removed.
The downgrade primarily reflects the system's weakened financial position evidenced by declines in liquidity levels that were driven by cash funding of one-time projects. The rating also considers the small customer base located in an affluent recreational touristic service area.
Further, the rating incorporates a manageable debt ratio with average principal amortization and adequate legal provisions.
