The improving financial condition of Lodi's Electric Utility has resulted in yet another upgrade from a leading ratings agency.
Fitch Ratings has boosted its rating of the utility to BBB+, the second time in 11 months Fitch has raised its assessment of the utility's ability to repay debt. Fitch raised the rating from BBB- to BBB in August 2007. The electric utility's rating was lifted in May by Standard & Poor's to A-.
In its press release announcing the upgrade today, Fitch noted that new City management and recent utility policies, such as transferring a reduced percentage of revenue to the city's General Fund and a monthly energy cost adjustment, are resulting in a stronger utility. Fitch maintained its "positive" outlook for utility debt, and suggested further upgrades may be warranted.
The recent upgrades by Fitch and Standard & Poor's will result in lower expenses related to an anticipated $63 million to $65 million refinancing this month of existing utility debt.
"The City Council has worked hard to strengthen the utility, implementing the changes recommended by the financial community and city staff," Lodi City Manager Blair King said. "We'll continue taking the steps we need to ensure stability for ratepayers and the utility in the future."