Summary: King County, Washington; Water/Sewer

S&P Global Ratings assigned its 'AA' long-term rating to  King County, Wash.'s approximately $145 million 2021 series A junior lien sewer revenue refunding bonds (SIFMA index), issued for the county's wastewater treatment division (WTD). At the same time, S&P Global Ratings affirmed its: 'AA+' long-term rating on the county's parity lien sewer revenue bonds and 'AA' long-term rating and underlying rating (SPUR) on the county's junior-lien sewer revenue bonds. The outlook is stable. We have applied our primary criteria to determine the entity's general creditworthiness (ICR) and have applied this rating to the parity lien issues and assigned a rating that is one-notch lower to the junior-lien issues. The county has previously issued debt payable from wastewater net revenue that

...would occur. Given the county's strong long-term ratings, robust liquidity position, and well-defined financial policies, we do not view the series A index bonds as a material contingent liquidity risk for the sewer system. In our view, setting a call protection date at least six months in advance of the mandatory purchase date allows the county sufficient time to remarket or otherwise redeem the bonds--especially in the event of unforeseen market dislocation or other factors exogenous to the county's own credit quality. Moreover, the WTD has access to interfund borrowing from other county funds held in the $7.9 billion King County investment pool (of which $3.2 billion is legally accessible) to provide interim financing for its capital improvement plan (CIP), pending the issuance of long-term bonds or the receipt of SRF loan funds, and we believe the WTD could draw from these funds temporarily to redeem the bonds, if needed. A rate covenant requires the system to generate debt service...

Summary