OREANDA-NEWS. Fitch Ratings has affirmed the short-term 'F1' rating assigned to the $87,275,000 City of Colorado Springs, CO variable rate demand utilities system improvement and refunding bonds, series 2007B. The short-term rating action is in connection with: (i) the substitution of the liquidity support provided by Barclays Bank plc (rated 'A/F1' Stable Outlook) in the form of a Standby Bond Purchase Agreement (SBPA), with a substitute liquidity facility in the form of a standby revocable letter of credit (SLOC) issued by Sumitomo Mitsui Banking Corporation (SMBC; rated 'A/F1', Negative Outlook), acting through its New York branch; and (ii) the mandatory tender of the bonds.


The short-term 'F1' rating is based on the liquidity support provided by SMBC, in the form of a substitute SLOC, which has a stated expiration date of Sept. 14, 2021, unless extended or earlier terminated, during the weekly interest rate mode only. Colorado Springs Utilities' 'AA' long-term rating reflects the diverse combined utility revenue base, with continued solid financial performance and competitive retail rates, despite a considerable capital spending program. The Rating Outlook is Stable. For more information on the long-term rating, see the press release dated Aug. 28, 2015, available on Fitch's website at www. fitchratings. com.

The substitute SLOC provides for the payment of the principal component of purchase price plus an amount equal to 35 days of interest calculated at a maximum rate of 12%, based on a year of 365 days for tendered bonds during the weekly rate mode in the event that the proceeds of a remarketing of the bonds are insufficient to pay the purchase price following an optional or mandatory tender. The substitute SLOC will expire on Sept. 14, 2021, the stated expiration date, unless such date is extended; upon conversion to any mode other than weekly; or upon the occurrence of certain events of default which result in a mandatory tender or other events of default related to the credit of the bonds which result in an automatic and immediate termination. A mandatory tender of the bonds has occurred. The remarketing agent for the bonds is Morgan Stanley & Co. LLC.