Contra Costa County and the City of Oakley recently received good news from Standard and Poors as they each received an upgrade. Contra Costa County was upgraded from “AA” to “AAA” while the City of Oakley went from “A” to “A+”.
Here is the information below.
Publication date: 19-Dec-2013 19:30:01 EST
SAN FRANCISCO (Standard & Poor’s) Dec. 19, 2013–Standard & Poor’s Ratings Services raised its long-term rating to ‘A+’ from ‘A’ on Oakley, Calif.’s certificates of participation (COPs) outstanding based on our recently released local general obligation criteria. The outlook is stable.
“We believe the district has very strong budgetary flexibility with reserves in excess of 30% of general fund expenditures,” said Standard & Poor’s credit analyst Jaime Trejo. “We also anticipate that the city’s budgetary performance will at least remain adequate,”added Mr. Trejo.
The COPs represent an interest in lease payments made by Oakley, as lessee, for the use and possession of certain leased assets through a lease-leaseback structure, in which the city will make periodic, sufficient lease payments to amortize the COPs.
RELATED CRITERIA AND RESEARCH Related Criteria USPF Criteria: Local Government GO Ratings Methodology And Assumptions, Sept. 12, 2013 Related Research S&P Public Finance Local GO Criteria: How We Adjust Data For Analytic Consistency, Sept. 12, 2013 Institutional Framework Overview: California Local Governments
Contra Costa County
SAN FRANCISCO (Standard & Poor’s) Dec. 20, 2013–Standard & Poor’s Ratings Services raised its issuer credit rating (ICR) to ‘AAA’ from ‘AA’ on Contra Costa County, Calif. At the same time, Standard & Poor’s raised its long-term ratings to ‘AA+’ from ‘AA-‘ on the county’s existing lease revenue bonds and pension obligation bonds. The outlook is stable.
“The raised ratings reflect the application or our recently released local GO criteria,” said Standard & Poor’s credit analyst Kate Burroughs. “The ratings are further supported by our view of the county’s very strong management, liquidity, and economy,” Ms. Burroughs added. Contra Costa County is located in the broad and diverse San Francisco Bay Area economy.
RELATED CRITERIA AND RESEARCH Related Criteria USPF Criteria: Local Government GO Ratings Methodology And Assumptions, Sept. 12, 2013 USPF Criteria: Appropriation-Backed Obligations, June 13, 2007 Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at www.spcapitaliq.com. All ratings affected by this rating action can be found on Standard & Poor’s public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.
For those curious on the City of Brentwood, there last Standard and Poor Rating occurred in October of 2011 where they received an “A-” rating to the Brentwood Infrastructure Financing Authority, Calif.’s capital improvement revenue bonds, series 2011. At the same time, Standard & Poor’s affirmed its ‘AA’ issuer credit rating (ICR) on Brentwood. Lastly, Standard & Poor’s affirmed its ‘AA-‘ rating on the authority’s lease revenue bonds outstanding, issued on behalf of the city. The outlook on all ratings is stable.
What do the letter ratings mean?
The general meaning of our credit rating opinions is summarized below.
‘AAA’—Extremely strong capacity to meet financial commitments. Highest Rating.
‘AA’—Very strong capacity to meet financial commitments.
‘A’—Strong capacity to meet financial commitments, but somewhat susceptible to adverse economic conditions and changes in circumstances.
‘BBB’—Adequate capacity to meet financial commitments, but more subject to adverse economic conditions.
‘BBB-‘—Considered lowest investment grade by market participants.
‘BB+’—Considered highest speculative grade by market participants.
‘BB’—Less vulnerable in the near-term but faces major ongoing uncertainties to adverse business, financial and economic conditions.
‘B’—More vulnerable to adverse business, financial and economic conditions but currently has the capacity to meet financial commitments.
‘CCC’—Currently vulnerable and dependent on favorable business, financial and economic conditions to meet financial commitments.
‘CC’—Currently highly vulnerable.
‘C’—Currently highly vulnerable obligations and other defined circumstances.
‘D’—Payment default on financial commitments.
Note: Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.