Summary: Mountain House Community Services District, California; Combined Utility; Water/Sewer

S&P Global Ratings raised its rating to 'BBB' from 'BBB-' on Mountain House Community Services District, Calif.'s outstanding utility system bonds. At the same time, S&P Global Ratings assigned its 'BBB' rating to the Mountain House Financing Authority, Calif.'s $91.3 million series 2020A utility system revenue bonds and its 'BBB-' rating to the authority's $37.3 million subordinate series 2020B utility system revenue bonds issued for the district. The outlook is stable. Although we consider the district's current financial position weak, we raised the rating based on our opinion of additional supplemental amendments to the installment purchase contract that we believe set a guide path towards future structural balance, thus providing improved bondholder protection. Nevertheless, we also note that the significant

...S&P Global Ratings raised its rating to '###' from '###-' on Mountain House Community Services District, Calif.'s outstanding utility system bonds. At the same time, S&P Global Ratings assigned its '###' rating to the Mountain House Financing Authority, Calif.'s $91.3 million series 2020A utility system revenue bonds and its '###-' rating to the authority's $37.3 million subordinate series 2020B utility system revenue bonds issued for the district. The outlook is stable. Although we consider the district's current financial position weak, we raised the rating based on our opinion of additional supplemental amendments to the installment purchase contract that we believe set a guide path towards future structural balance, thus providing improved bondholder protection. Nevertheless, we also note that the significant increase in additional debt will results in a meaningful erosion in direct PFC debt service coverage over the outlook period. Bond proceeds are expected to be used to repay developer...

Summary