San Diego Community Power wins A (stable) S&P rating; treasurer reports strong reserves amid public questions on debt and transparency

San Diego Community Power announced March 19 that S&P Global Ratings has assigned the agency an A rating with a stable outlook, a milestone that staff said will improve access to favorable financing and contract terms.

"I am pleased to share that Community Power has received an A, stable credit rating from S&P Global Ratings," CEO Garren Burns told the Finance & Risk Management Committee, saying the score reflects the agency’s diverse customer base, strong governance and a disciplined financial profile. Burns thanked staff and PFM municipal advisers for their work leading to the rating.

The rating was presented alongside the agency’s mid‑year financial report. Interim Treasurer Jeb Spangler told the committee that through Dec. 31, 2025 the agency posted approximately $762 million in net operating revenues versus $586 million in total expenses for a year‑to‑date net position of about $176 million. Spangler said total investments at that date were $640.3 million and the agency’s days cash on hand stood at roughly 231, slightly above a newly adopted target of 225 days.

Spangler also announced a prepaid energy transaction closed the morning of the meeting that staff expects will deliver additional savings (the presentation referenced a transaction expected to deliver $43.2 million in total savings over 10 years) and said prepaid mechanisms and investment income help offset costs and strengthen financial results.

Dan Delaney of Chandler Asset Management, the agency’s investment adviser, told the committee the portfolio is diversified across high‑quality fixed‑income sectors, maintains a short average maturity (about three years) and produces roughly a 4% purchase yield that helps insulate the fund from near‑term interest‑rate volatility.

Public commenters praised the credit rating but pressed staff on lingering transparency and customer‑debt concerns. One speaker who identified himself as Robert said the S&P report and meeting packet raised questions: he asserted that the agency’s rates are "150% of the state's average," said the agency is carrying roughly $61 million in residential receivables more than 120 days past due, and questioned whether S&P had access to full audited disclosures given his claim that an accounting firm used by the agency was not independent.

Committee and staff responses in the meeting emphasized the rating reflects external surveillance and financial discipline; Spangler and Burns described the rate and reserve tools under discussion as standard sector practices used to manage volatility and meet covenant requirements. Staff also noted that designated rate stabilization amounts are reported as a line item and remain part of reported unrestricted investments under the accounting treatment discussed in the presentation.

What happens next: the committee carried the staff recommendation to receive the credit‑rating announcement on file; the board will continue routine oversight and S&P will perform ongoing surveillance of the agency’s credit profile. Staff said it will present further detail on prepaid transaction results and the audited financial disclosures in future meetings.