Florida residents will likely continue to see water rate increases in the coming years, despite the already-steady incline seen since the state's housing boom, says Fitch Ratings.
However, as Florida's average monthly residential bill for combined service approaches Fitch's affordability marker of 2% of median household income, utilities may see increased political pressure around future rate hikes.
'For many water utilities, Florida's rapid housing expansion led to the expansion of water and sewer infrastructure and the debt to finance it,' says
While utilities' financial results have improved with the economy, rate hikes will likely continue as they face increased spending from tighter regulations on wastewater effluent disposal and water quality, longer-term water supply needs, and from ongoing repairs and maintenance.
Regionally, expectations for future development, as well as climactic, geographic and ecological nuances, present different challenges for Florida utilities over the long term.
Overall, Florida's water and sewer utility ratings remain strong, and have benefitted from improving economic conditions, stable customer demand trends and sound management.
While rising affordability concerns are unlikely to lead to negative rating actions over the short term, a utility's ability to adopt and implement rate increases may become more limited over time, potentially affecting ratings over the longer term.
The full report 'Peer Review:
Additional information is available at 'www.fitchratings.com'.
Source: Fitch Ratings
Most Popular Stories
- Criminal Investigation Opened Into James Foley's Death
- Is Diversity in the Eye of the Beholder?
- Apple Stock Bounces Back Big Time
- Investors Betting on ECB Stimulus Measures
- 'Mythbusters' Build Team Gets the Boot
- Jennifer Lopez Would Marry Again
- Florida Judge Rules in Favor of GOP Voter Map
- Mo'Ne Davis a Big Winner Despite Loss
- DHS Warns Retailers About Malware in Cash Registers
- Hackers Get Homeland Security Employee Records