Standard & Poor's Ratings Services raised its long-term rating to A from A-minus on the Colorado Health Facilities Authority's series 2004 revenue bonds issued for Vail Valley Medical Center.
The outlook is stable.
"The rating action reflects our view of VVMC's consistently strong operations, driven by its strong business position, which have substantially improved liquidity," said Standard & Poor's credit analyst Santo Barretta.
VVMC will implement a significant four-year capital spending plan in fiscal 2015. The plan calls for an average annual increase of $25 million in capital expenditures above routine capital spending, which has averaged a little less than $19 million since 2011.
Management plans to fund the project from roughly 50% operations, 25% debt, and 25% philanthropy; in preparation, it has brought the medical center's foundation out of dormancy and plans on hiring a consultant to aid with fundraising.
"Given VVMC's proven ability to post robust operations and its already very strong balance sheet, we anticipate that the medical center will be able to complete its capital spending project and maintain financial metrics commensurate with the new rating," added Barretta.
