Standard&Poor's Ratings Services revised the outlook to stable from positive and affirmed its 'AA-' long-term rating and underlying rating (SPUR) on Los Angeles, Calif.'s general obligation (GO) bonds and its 'A+' long-term rating and SPUR on the city's appropriation-backed debt outstanding. The stable outlook reflects our view of the uncertainty surrounding the city's significant litigation, particularly regarding the class action lawsuits challenging the validity of the city's power revenue fund transfers. The transfers are about $250 million, or 5% of expenditures, annually, and if a significant portion of them were invalidated by the courts, the city would face a budget gap. However, we believe that some amount of cost allocation could be allowed. We understand that, to date,
