Value Delivered:

KNN Public Finance helped the City of Lompoc, an infrequent issuer, achieve a solid "A" category credit rating and successfully issue Water and Wastewater Revenue Bonds through competitive bidding in spite of a challenging credit story.
   
Strategic Implementation:

To fund new capital needs for its water and sewer utilities, the City was faced with the need to approve significant new rate increases. In addition, the City was faced with the possibility of a rating downgrade and unavailability of bond insurance due to a number of factors, including not meeting its rate covenant from an earlier bond issue for two consecutive years. KNN undertook an in-dept analysis of the operating history and current financial position of the two utilities, including several conversations with staff about the factors which contributed to lower than expected net revenues and the subsequent implementation of financial management. It also become clear that the City had a well-planned approach to communicating the need for rate increases to the community. KNN concluded that the utilities' credit was much stronger than it appeared on the surface and helped the City develop a presentation to demonstrate the credit strengths to the rating agency and the only bond insurer willing to listen to the story.
   
Results:

KNN helped the City to keep its "A" category rating, obtain cost-effective bond insurance, and secure low interest rates through a well-received competitive bond sale.