NEW YORK - Standard & Poor's Ratings Services said it raised its underlying rating (SPUR) on Sumner, Wash.'s water and sewer revenue debt to AA from A. The outlook is stable.
At the same time, Standard & Poor's assigned its AA standard long-term rating to the city's series 2008 water and sewer revenue refunding bonds.
"The upgrade is based on the city's strong debt service coverage and very strong liquidity," said Standard & Poor's credit analyst Jim Tchou.
The rating also reflects the city's participation in the broad and deep Seattle-Tacoma economic region, its sufficient system capacity to meet projected demand, and low utility rates compared with neighboring communities.
Tempering the system's rating is a partial dependence on growth-driven connection fees to generate strong debt service coverage.
The bonds are secured by the net revenues of the combined water, sewer and stormwater operations, including connection charges and utility local improvement district assessments. Proceeds will be used to refinance a portion of the outstanding series 1998 parity bonds.
Sumner (A-plus GO rating), which serves an estimated population of 9,035, is located 33 miles south of Seattle and 12 miles east of Tacoma.
