Detroit Water and Sewer Bonds Downgraded to Junk Status

On July 3, 2013, Standard & Poors downgraded its rating of Detroit water and sewer bonds to junk status. The rating agency reduced its rating on $5.42 billion bond debt to BB-minus from A and A-plus. This action was taken due to the potential the debt could be restructured by Detroit's Emergency Manager, Kevyn Orr. Uncertainty about the EM's future actions, including a possible bankruptcy, weighed heavily in S&P's decision. 

On April 1, 2013, Fitch Ratings reduced Detroit's water and sewer bond debt to BBB and BBB-plus.

For prior posts about DWSD's water and sewer debt rating, click here.

For more about DWSD Update, click here.