The 'A-' rating on Philadelphia, Pa.'s water and sewer bonds reflects: Stable financial performance; Sound debt service coverage of senior revenue debt at 1.20x, with 1.07x coverage of revenue debt, and transfers to general fund, capital fund, and residual fund; and A seasoned management team that emphasizes, and is achieving, improved system maintenance, stronger collections, and more comprehensive fiscal monitoring systems. Continuing offsetting credit factors include a slowly declining customer base, still-below-standard collection rates, and a sizeable capital plan. The stable outlook reflects the expectation that the water department can continue to maintain its current financial and operational performance.
