Standard & Poor's revised the outlook to stable from negative and affirmed a BBB underlying rating on almost $200 million of Reno, Nev., capital improvement revenue bonds. The revised outlook affects the city's series 2002, 2005A, 2005B, and 2005C tax-exempt capital improvement revenue bonds.

"The stable outlook reflects our view that the city's pledged revenue has continued to show signs of stabilizing," said Standard & Poor's credit analyst Bryan Moore. "Recent strong coverage provides some cushion, in our view, but if further declines in pledged revenues lead to a drop in annual debt service coverage closer to one times, we could lower the rating."

The rating agency could raise the rating if pledged revenues continue to increase, resulting in greater than one times coverage on maximum annual debt services, and if economic growth continues, Moore said.

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