Summary: King County, Washington; CP; Joint Criteria; Water/Sewer

S&P Global Ratings affirmed its various ratings on King County, Wash.'s outstanding debt, including its: 'AA+' long-term and underlying rating on the county's parity-lien sewer revenue bonds; 'AA' rating on the county's junior-lien sewer revenue bonds; 'AA+/A-1' rating on the county's joint criteria bonds; and 'A-1+' short-term rating on the county's existing commercial paper (CP) debt. The outlook, where applicable, is stable. In addition to the above bonds, the county has parity-lien limited-tax general obligation bonds (LTGO) refunding bonds and multi-modal LTGO bonds payable from sewer net revenue as well. These bonds, however, benefit from a full faith and credit pledge of the county. At this time, the GO rating on the county remains the stronger pledge. We understand the

...ample room under the tax rate cap and a $606.6 billion tax base (2019 value) that continues to perform well. Our view of the sewer system's overall credit characteristics reflect: + Its role as a major regional provider of wastewater treatment services within the broad and diverse Seattle-Tacoma-Bellevue metropolitan statistical area (MSA); + The county council's demonstrated ability and willingness to incrementally and regularly increase sewer rates and connection charges, resulting in financial stability in recent years even as the county funded and completed a multi-billion dollar capital program; and + The sewer system's consistent financial performance, with strong, stable and predictable debt service coverage (DSC) (across all liens and including its LTGO debt service), which we believe is sustainable based on the county's well defined debt and reserve policies. Partially offsetting the above strengths, in our view, is the sewer system's high outstanding leverage (as measured by the...

Summary