Standard & Poor's Ratings Services on Wednesday assigned preliminary BBB and BBB-minus ratings to a $1.74 billion sewer warrants debt offering by Alabama's bankrupt Jefferson County expected this month, Reuters reported yesterday. The offering, which is meant to replace $3.1 billion of defaulted sewer debt, is central to Jefferson County's negotiated plan to end what is the nation's second-largest municipal bankruptcy after Detroit. S&P said that it had given a preliminary underlying BBB rating to Jefferson County's proposed series 2013-A senior-lien sewer revenue current interest warrants, series 2013-B senior-lien sewer revenue capital appreciation warrants, and its series 2013-C senior-lien sewer revenue convertible capital appreciation warrants. A BBB rating means that the county’s proposed debt is perceived to have adequate capacity to meet financial commitments, but still has vulnerabilities. The $500 million of senior lien bonds will be insured by Assured Guaranty Municipal Corp., which S&P rates AA-minus, according to the preliminary official statement for the deal expected to be priced through Citigroup the week of Nov. 18.
