Standard & Poor’s raised its underlying rating to AA from AA-minus on the Los Angeles County Public Works Financing Authority’s Series 2005A revenue bonds for the Los Angeles County Flood Control District and outstanding parity Series 2003A bonds.
“We base the upgrade on what we view as high and increasing debt service coverage,” said Standard & Poor’s credit analyst David Hitchcock.
The stable outlook rating reflects high coverage of debt service by pledged revenues and the stability of Los Angeles’ tax base.
The Series 2005A and 2003A bonds are secured by the Los Angeles County Flood Control District’s absolute and unconditional pledge of its portion of the 1% ad valorem property tax levied in total in the county on behalf of all overlapping taxing entities
The tax pledge is absolute to the extent that it is received by the district, and if this is insufficient to pay debt service, it will be secured by a pledge of any benefit assessments imposed by the district.
Pledged revenues are received pursuant to an installment purchase contract with the Los Angeles County Flood Control District.
The district was established in 1915 and encompasses approximately 2,752 square miles within the county, containing about 98% of its assessed valuation and 99% of its population.
It is responsible for a wide range of flood control projects and is administered by the Los Angeles County Public Works Department as a separate enterprise fund.
