On May 3, 2005, Standard&Poor's Ratings Services assigned its 'BBB-' rating and a recovery rating of '1' to Tucson Electric Power Co.'s (TEP; BB/Stable/B-1) $401 million secured banking facility due May 2010. The rating, which is one notch higher than the bank loan it is refinancing, reflects TEP's pending elimination of the utility's first mortgage indenture. The discharge of this indenture will result in TEP's second mortgage lien, which secures the new bank facility, becoming the utility's senior lien. The new bank agreement is comprised of a $60 million general corporate purposes revolving credit tranche and a $340.6 million letter of credit tranche to support $329 million of tax-exempt variable-rate industrial development bonds (IDBs). Under the terms of
