Fitch Rates Calif. Pollution Control Fin Auth VRDBs, (Bay Counties SMaRT Project) Ser 2014 'A/F1'

NEW YORK--()--Fitch Ratings assigns a rating of 'A/F1' to the $8,820,000 California Pollution Control Financing Authority variable rate demand solid waste disposal revenue bonds (Bay Counties SMaRT Project) series 2014. The Rating Outlook for the long-term rating is Stable.

KEY RATING DRIVERS

The rating is based on the support provided by an irrevocable direct-pay letter of credit (LOC) issued by Comerica Bank (rated 'A/F1'; Stable Outlook by Fitch).

The bank is obligated to make payments of principal and interest on the bonds upon maturity, acceleration and redemption, as well as purchase price for tendered bonds. The rating will expire upon the earliest of: (a) Oct. 2, 2019, the stated expiration date of the LOC, unless such date is extended; (b) conversion to a mode other than a weekly rate mode; (c) any prior termination of the LOC; and (d) defeasance of the bonds. The LOC provides full and sufficient coverage of principal plus an amount equal to 45 days of interest at a maximum rate of 12% based on a year of 365 days and purchase price for tendered bonds, while in the weekly rate mode. The Remarketing Agent for the bonds is Westoff, Cone & Holmstedt. The bonds are expected to be delivered on or about October 15, 2014.

The bonds initially bear interest at a weekly rate, but may be converted to a term rate. While bonds bear interest in the weekly rate mode, interest is paid on the first Wednesday of each month, commencing on November 5, 2014. The trustee is obligated to make timely draws on the LOC to pay principal, interest, and purchase price. Funds drawn under the LOC are held uninvested, and are free from any lien prior to that of the bondholders.

Holders may tender their bonds on any business day, provided the trustee and the remarketing agent are given the requisite prior notice of the purchase. The bonds are subject to mandatory tender: (1) upon conversion of the interest rate; (2) upon substitution or termination of the LOC; and (3) following receipt of written notice from the bank of an event of default under the reimbursement agreement, directing such mandatory tender. The bank has the option of directing an acceleration rather than a mandatory tender upon an event of default under the credit agreement. The bonds shall be accelerated following the trustee's receipt of notice of non-reinstatement of the interest portion of the LOC. Optional and mandatory redemption provisions also apply to the bonds including a mandatory redemption upon the expiration of the LOC. There are no provisions for the issuance of additional bonds.

The proceeds of the bond sale will be used to finance and/or refinance the cost of acquiring, constructing, installing and equipping certain solid waste disposal facilities.

RATING SENSITIVITIES

The rating is exclusively tied to the short and long-term rating that Fitch maintains on the bank providing the LOC and will reflect all changes to that rating.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

-'U.S. Municipal Structured Finance Criteria'(Feb. 24, 2014); 'Rating Guidelines for Letter of Credit-Supported Bonds and Commercial Paper' (June 2, 2014).

Applicable Criteria and Related Research:

U.S. Municipal Structured Finance Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=736618

Rating Guidelines for Letter of Credit-Supported Bonds and Commercial Paper

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=749431

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=892334

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Primary Analyst
Linda Friedman
Senior Director
+1-212-908-0727
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Mario Civico
Senior Director
+1-212-908-0796
or
Elizabeth Fogerty, +1-212-908-0526
Media Relations
New York
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Linda Friedman
Senior Director
+1-212-908-0727
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Mario Civico
Senior Director
+1-212-908-0796
or
Elizabeth Fogerty, +1-212-908-0526
Media Relations
New York
elizabeth.fogerty@fitchratings.com