OREANDA-NEWS. S&P Global Ratings lowered its long-term rating to 'BB+' from 'BBB-' on Higginsville, Mo.'s series 2010 sewerage system revenue bonds. The outlook is stable.

"The downgrade reflects the system's structural imbalance due to the spending down of cash and interfund borrowing to meet its obligations during fiscal 2012 through 2015," said S&P Global Ratings credit analyst Gregory Dziubinski. The stable outlook reflects the significant rate increase in sewer rates in April 2015, which we expect will help stabilize the system's finances.

The 'BB+' rating reflects the combination of a strong enterprise risk profile and a vulnerable financial risk profile.

The city's pledge of sewerage system net revenues secures the bonds. The sewer system serves a stable base of about 1,940 customers, unchanged since 2009, across 3.5 square miles in western Missouri's Lafayette County.