Fitch Downgrades S-T Rating of El Paso, TX Water & Sewer CP Notes Series A to 'F1'

NEW YORK--()--Fitch Ratings has downgraded the short-term rating for the $40,000,000 City of El Paso, Texas water and sewer tax-exempt commercial paper notes, series A to 'F1' from 'F1+'. The rating action is in connection with: (i) the substitution of the revolving credit agreement (RCA) previously provided by JPMorgan Chase Bank, N.A. (rated 'AA-/F1+', Outlook Stable) with a substitute RCA to be issued by Bank of America, N.A. (rated 'A+/F1', Outlook Stable), and (ii) the reoffering of the notes, which occurs on Aug. 24, 2015. A maximum of $40,000,000 aggregate principal amount of authorized notes may be outstanding at any given time.

KEY RATING DRIVERS

The rating on the series A notes is 'F1' based on the support provided by the RCA provided by Bank of America, N.A., which has a stated expiration date of Aug. 23, 2018, unless extended or earlier terminated. The Bank of America substitute RCA provides coverage for the principal amount of the notes only. The City of El Paso is obligated to pay interest upon maturity of all notes. The water and sewer senior and subordinate lien obligations of the City of El Paso are rated 'AA+', Outlook Stable. For more information on the city's long-term ratings, see Fitch's press release dated Aug. 12, 2015, available on Fitch's web site at 'www.fitchratings.com'.

The Bank of New York Mellon Trust Company, N.A. acting as Issuing and Paying Agent (IPA) will continue as the IPA for the notes, and as IPA, is directed to request an advance under the substitute RCA whenever proceeds of the sale of rollover notes are insufficient to pay maturing notes. The substitute RCA provides sufficient coverage for the principal amount of notes and the issuer is obligated to pay interest on the notes.

All notes will be issued at par, with interest due at maturity. Following the occurrence of an event of default under the RCA, Bank of America may direct the IPA to immediately stop the issuance of any additional notes. In such event, the substitute RCA will expire after all the notes supported by such RCA mature and have been paid from funds drawn on the substitute RCA. In addition, the substitute RCA may be terminated by the bank upon the occurrence of specified immediate termination events. The dealer for the notes is Bank of America Merrill Lynch.

RATING SENSITIVITIES

The rating reflects the short-term rating that Fitch maintains on the substitute bank providing liquidity support and will be adjusted upward or downward in conjunction with changes to the short-term rating of the bank and in some cases, the long-term rating of the issuer.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Rating Guidelines for Variable-Rate Demand Obligations and Commercial Paper Issued with External Liquidity Support (pub. 22 Jan 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=856189

U.S. Municipal Structured Finance Criteria (pub. 23 Feb 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862222

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=989844

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=989844

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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
Joseph Staffa
Senior Director
+1-212-908-0829
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Linda Friedman
Senior Director
+1-212-908-0727
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Joseph Staffa
Senior Director
+1-212-908-0829
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Linda Friedman
Senior Director
+1-212-908-0727
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: sandro.scenga@fitchratings.com