Whittier Utility Authority, CA's Water Revenue Bonds Series 2009A Rated 'AA+'; Outlook Stable

Standard & Poor's Ratings Services assigned its 'AA+' long-term rating and stable outlook to Whittier Utility Authority, Calif.'s water revenue bonds, series 2009A. "The rating reflects our view of the city's stable and diverse local economy, coupled with strong economic indicators and full participation in the greater Los Angeles region; use of Whittier's groundwater wells as its main water source, which we believe leads to predictable water expenditures; strong 2.35x maximum annual debt service coverage based on unaudited fiscal 2009 figures and strong liquidity sources, which is further stabilized by the authority's history of successfully implementing water rate increases; and history of strong liquidity levels, most recently 947 days' operations," said Standard & Poor's credit analyst Li Yang. A pledge of net water revenues secures the bonds. We understand that bond proceeds will be used to fund the authority's water capital improvement program, which includes pipeline and pumping station replacements and various improvements to the authority's existing water system. The stable outlook reflects our view of the authority's history of maintaining very strong cash reserves in the water fund as well as a local water source that minimizes long-term upward pressure on supply cost. Furthermore, we believe the authority's history of adjusting rates supports our view that authority is positioned to maintain strong coverage levels going forward. RELATED RESEARCH USPF Criteria: "Standard & Poor's Revises Criteria For Rating Water, Sewer, And Drainage Utility Revenue Bonds," Sept. 15, 2008 Complete ratings information is available to RatingsDirect subscribers at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; select your preferred country or region, then Ratings in the left navigation bar, followed by Find a Rating. Media Contact: Ana Sandoval, New York (1) 212-438-5095, [email protected] Analyst Contacts: Li H Yang, San Francisco 1-415-371-5024 Chris Morgan, San Francisco (1) 415-371-5032

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