Summary: Los Angeles, California; Appropriations; General Obligation

S&P Global Ratings placed its 'AA' long-term rating on City of Los Angeles, Calif.'s general obligation (GO) bonds on CreditWatch with negative implications. The negative CreditWatch placement is also applicable to the 'AA-' long-term rating on the Municipal Improvement Corp. of Los Angeles' (MICLA) lease revenue bonds, issued on behalf of the city. The CreditWatch placement reflects our view of the city's weakening financial trends and the introduction of additional credit risk tied to the multiple wildfires that began on Jan. 7, 2025. We believe that the fires and reports of widespread damage introduced heightened risk of credit deterioration for the Los Angeles Department of Water and Power (LADWP), which could pressure the city's finances, in addition to near-term risk

...+ S&P Global Ratings placed its '##' long-term rating on City of Los Angeles, Calif.'s general obligation (GO) bonds on CreditWatch with negative implications. + The negative CreditWatch placement is also applicable to the '##-' long-term rating on the Municipal Improvement Corp. of Los Angeles' (MICLA) lease revenue bonds, issued on behalf of the city. + The CreditWatch placement reflects our view of the city's weakening financial trends and the introduction of additional credit risk tied to the multiple wildfires that began on Jan. 7, 2025. We believe that the fires and reports of widespread damage introduced heightened risk of credit deterioration for the Los Angeles Department of Water and Power (LADWP), which could pressure the city's finances, in addition to near-term risk to the city's property tax base and financial position. The CreditWatch placement further reflects a one-in-two chance that we could take a negative rating action during the next 90 days....

Summary