El Cerrito, CA COP Rating Lowered Two Notches To 'BBB' On Deteriorating Budgetary Flexibility

SAN FRANCISCO (S&P Global Ratings) Nov. 26, 2019--S&P Global Ratings lowered its underlying rating (SPUR) to 'BBB' from 'A-' on El Cerrito, Calif.'s certificates of participation (COPs) outstanding. The outlook is negative. "The lowered rating reflects our view of the continued deterioration of the city's already weakened budgetary flexibility, driven primarily by continued strain on the city's revenue, rising fixed costs with projected pension pressures, and one-time costs associated with the state's wildfires," said S&P Global Ratings credit analyst Benjamin Geare. The downgrade also reflects our view of the city's second consecutive audit with a "going concern" opinion by the auditor, which reflects the auditor's concern about the city's ability to meet required operating obligations. To a lesser extent, the

...November 26, 2019 SAN FRANCISCO (S&P Global Ratings) Nov. 26, 2019--S&P Global Ratings lowered its underlying rating (SPUR) to '###' from 'A-' on El Cerrito, Calif.'s certificates of participation (COPs) outstanding. The outlook is negative. "The lowered rating reflects our view of the continued deterioration of the city's already weakened budgetary flexibility, driven primarily by continued strain on the city's revenue, rising fixed costs with projected pension pressures, and one-time costs associated with the state's wildfires," said S&P Global Ratings credit analyst Benjamin Geare. The downgrade also reflects our view of the city's second consecutive audit with a "going concern" opinion by the auditor, which reflects the auditor's concern about the city's ability to meet required operating obligations. To a lesser extent, the downgrade also reflects our revised assessment of the city's financial management policies and practices to standard from good. The negative outlook is supported...

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