OREANDA-NEWS. Fitch Ratings assigns a rating of 'F1' to $150,000,000 Santa Clara Valley Water District (CA) commercial paper certificate series A (tax-exempt) and series B (taxable) (certificates).

KEY RATING DRIVERS
The rating is based on the support provided by an irrevocable direct-pay letter of credit (LOC) issued by The Bank of Tokyo-Mitsubishi UFJ, LTD., acting through its New York Branch (Bank of Tokyo, rated 'A/F1', Stable Outlook) which has a stated expiration date of Feb. 12, 2018 unless extended or earlier terminated. The Bank of Tokyo LOC provides coverage for the principal amount of the certificates and interest due on the maturity dates of the certificates.

U.S. Bank, National Association, as the Issuing and Paying Agent (IPA) for the certificates is directed to request an advance under the LOC to pay principal and interest on maturing certificates. The LOC provides sufficient coverage for the principal amount of certificates and 270 days of interest calculated at 12% based on 360 day year.

All certificates will be issued at par, with interest due at maturity. Following the occurrence of an event of default under the LOC, The Bank of Tokyo may direct the IPA to immediately stop the issuance of any additional certificates. The bank will also notify the IPA that the stated amount of the LOC shall be permanently reduced to the principal amount of certificates then outstanding and interest thereon, and shall be further permanently reduced following the maturity of any such certificates, in such an event, the LOC will expire after all the certificates supported by it mature and have been paid from funds drawn on the LOC. Alternatively, The Bank of Tokyo may also issue a final drawing notice directing the IPA to draw on its LOC for the principal and interest amount due on all outstanding certificates. The dealers for the certificates are: Barclays Capital Inc. and J.P. Morgan Securities LLC.

RATING SENSITIVITIES
The rating is exclusively tied to the short-term rating that Fitch maintains on the bank providing the LOC and will reflect all changes to that rating.