City officials said Tuesday that S&P lowered the rating to A and placed the city on negative watch due to water supply concerns and rising project costs.
CORPUS CHRISTI, Texas — The City of Corpus Christi’s utility system credit rating was lowered by S&P Global Ratings from AA- to A on Tuesday, citing ongoing drought concerns and the risk of a possible Level 1 water emergency later this year.
The city said the downgrade also reflects the need to secure additional water supplies and keep up with rising costs associated with major water projects.
The new “A” rating is still considered investment grade, but signals increased financial pressure.
The agency placed the city on a “negative credit watch,” meaning it will closely monitor financial performance, progress on water projects, and the city’s ability to raise utility rates over the next three to six months.
City officials said the rating could be raised or lowered again depending on those factors.
S&P also lowered credit ratings from AA- to A for certain water related debt tied to the Nueces River Authority and the Lavaca-Navidad River Authority. Those debt issues are connected to projects that move water from Lake Texana through the Mary Rhodes Pipeline.