Standard & Poor's Ratings Services said it has raised its underlying rating on Pen Argyl Municipal Authority, Pa.'s series 2012 and 2013 insured guaranteed sewer revenue general obligation bonds by one notch to A-plus from A.

This action is based on Standard & Poor's recently released local GO criteria. The outlook is stable.

The rating reflects Standard & Poor's assessment of these factors for the borough, specifically its: strong budgetary performance; very strong liquidity; adequate economy; adequate management conditions; weak budgetary flexibility; weak debt and contingent liabilities profile; and strong institutional framework.

"The stable outlook reflects our opinion of the borough's very strong liquidity position and adequate economy. For these reasons, we do not expect to change the rating within the two-year outlook period," said Standard & Poor's credit analyst Steve C. Tencer. "However, if the borough is unable to maintain balanced operations and subsequently draws down its available general fund reserves, we could lower the rating."

Pen Argyl Borough is located in Northampton County, Pa., 18 miles north of Easton and 21 miles north of Bethlehem.

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