PHOENIX - Roseville, Calif.'s water utility revenue certificates of participation won an upgrade from Standard & Poor's, which cited the system's ability to raise rates.
S&P said Wednesday it raised its underlying rating on the COPs to AA-minus from A-plus. The agency also assigned an AA-minus long-term rating to the city's series 2015 water utility revenue COPs, with a stable outlook.
The city, located in the Sacramento area, is issuing that debt to refund outstanding COPs and finance a portion of the water system's capital program.
"The stable outlook reflects our view of the system's primarily residential customer base and affordable service rates that provide management with revenue-raising flexibility," said S&P credit analyst Tim Tung.
The city is suffering through the effects of a West Coast drought that continues to put a strain on water usage throughout the state. Some analysts have said that water utilities revenues could face pressure from as conservation efforts, both mandatory and voluntary, take hold all over California.
The city is a frequent issuer, according to EMMA filings, borrowing through both COPs and bonds for various infrastructure projects.
