Press Release|Public Finance
View PDF

KBRA Affirms AA Rating with Stable Outlook for City of Los Angeles, CA Solid Waste Resources Revenue Bonds

25 Jun 2026   |   New York

Contacts

KBRA affirms the long-term rating of AA with a Stable Outlook for the City of Los Angeles, CA Solid Waste Resources Revenue Bonds.

The Stable Outlook reflects KBRA’s expectation that the Solid Waste Resources (SWR) Fee and other comparatively minor pledged sources will continue to provide strong coverage of debt service on the Bonds. The Outlook additionally expects recently implemented rate adjustments to reduce and ultimately eliminate the SWR Revenue Fund’s reliance on annual General Fund (GF) subsidies.

Key Credit Considerations

Credit Positives

  • Strong legal framework, with a clearly defined gross revenue pledge and solid bondholder protections.
  • Recently implemented SWR Fee adjustment schedule is expected to gradually phase out the need for an annual GF transfer to subsidize SWR Revenue Fund operations.
  • SWR Fees are related to an essential governmental service provided across a very large and stable economic base.

Credit Challenges

  • The SWR Revenue Fund has not been consistently self-supporting due to infrequent adjustments to the SWR Fee, resulting in significant historical reliance on GF subsidies.

Rating Sensitivities

For Upgrade

  • Establishment of a track record of consistent and timely SWR Fee rate adjustments, beyond the current five year ordinance, resulting in the realization and maintenance of SWR program self-sufficiency absent GF support.

For Downgrade

  • A decline in SWR Fee levels leading to a significant reduction in gross debt service coverage.
  • Reduced willingness of management and the City Council to provide GF support, as necessary, to ensure SWR Fund solvency.

To access ratings and relevant documents, click here.

Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1015718