News
Fitch Affirms Fort Pierce Utilities Authority (Florida) Revs at 'A-'; Outlook Stable
NEW YORK-(Business Wire)-October 3, 2008 - Fitch affirms the 'A-' rating on the Fort Pierce Utilities Authority's (FPUA) $75.211 million in outstanding revenue bonds. The Rating Outlook is Stable.
FPUA's solid financial management practices are reflected in the system's historically strong financial performance. Favorably, the utility has debt service coverage consistently over 2.0 times (x), an automatic power cost pass through that helps to assure stable operating margins, and provide cash to fund most ongoing capital expenditures. The rating also reflects, above average power costs and retail electric rates, recent public pressure against increasing base rates, and the service areas below average wealth indicators. Additionally, the 'A-' rating incorporates declines in sales growth over the last several years resulting from the prolonged residential recovery from hurricane damage in 2004 and 2005, and the current housing market downturn.
Credit drivers for FPUA include the system's continued stable financial performance and power cost recovery, in order to maintain financial metrics that are supportive of the rating.
FPUA has historically provided sound financial results with debt service coverage in fiscal year 2007 of 2.81x and over 75 days of operating cash. The system also benefits from a low debt burden, with debt-to-FADS in the 3x to 4x range. Management's financial policy is to target operating performance sufficient to maintain at least 60 days in unrestricted funds (about $16 million for 2008). This policy has historically provided debt service coverage in the range of 2.0x-3.0x and allows the system to pay on going system repairs and replacements from operations.
FPUA is a combined electric, water, natural gas and wastewater system. The electric division, which accounted for 60% of revenues in 2008, participates in Florida Municipal Power Agency's All Requirements Power Supply Project and serves 27,182 residential and small-commercial customers. In addition to the utilities, FPUA operates the Manatee Observation & Education Center (MOEC) with volunteer labor.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
 |
 |
 |
|
||
 |
|
 |
|
||
Search Our News Using Google Search
Can't find what you want? Try using Google:
