THE LOCALS HAVE KNOWN IT FOR AWHILE...WE SEE IT EVERY MONTH!

The lead story in today's Lakeland Ledger is that Fitch Ratings --- one of the "big three" bond rating services with Moody's and Standard & Poor's --- has reduced the rating for over a half billion dollars in utility bonds for Lakeland Electric from "AA-" to "A+", and downgraded the city-owned utility service's financial outlook from "stable" to "negative".

The actions were the result of what Fitch called "questionable past management decisions". Namely, Lakeland Electric's Unit 5 natrual gas generator with a capacity of 365 megawatts exceeds the city's needs, and the utility has been roundly screwed thanks to a contract it signed with the Florida Municipal Power Agency which has cost millions to customers.

Lakeland Electric is well known as being one of the most expensive public utilities statewide, and the FMPA fuel contract has been a huge pinch in the backside for customers. The willingness for Lakeland Electric to pass along the higher fuel costs to customer was one of the positive things that Fitch noted, along with lower dividends it would pay to the city over the next three years.

S&P and Moody's will be visiting Lakeland soon, and in most cases they will follow suit when one of their other "big three" rating brethern lowers a grade. While the electric utility is not expected to float bonds soon, the downgrade could have an effect on city projects as it is a city-owned/operated service.

There has been some noise made over the past months by utility customers who are tired of being screwed with excessively high bills, but the City Commission seems to be satisfied with the status quo. At some point it may be better to sell off Lakeland Electric to a private utility such as TECO Energy, but at this point that does not seem to be an option for serious discussion.