The feud surrounding Long Beach's troubled trash-to-energy incinerator this week caught the attention of a prestigious New York financial institution which downgraded the $170-million bond that funded the facility.
Standard & Poor's Corp., which publishes financial data and rates bonds according to their investment risks, demoted the bond one step--from an A rating to a BBB in its Oct. 16 publication.
The new rating marks the bond as a slightly more risky investment. A Standard & Poor's rating can substantially affect the value of a bond, investment officials say.
The Terminal Island plant is embroiled in a controversy between its Pittsburgh-based builder, Dravo Corp., and the city of Long Beach. The builder contends that the facility is finished, but the city says it is full of flaws and has refused to sign it off as complete. The builder last month expressed his intention to sue the city as a result.