Bangkok--24 Jul--Standard & Poor's
Standard & Poor's Ratings Services raised its long-term and underlying rating (SPUR) on Montana Department of Transportation's (MDT) grant anticipation notes (GARVEEs) to 'AA' from 'AA-'. The outlook is stable.
"The rating reflects MDT's strong federal and state programmatic support, the state's history of maximizing its share of federal reimbursement revenues, and a strong additional bonds test that requires historic 3.0x maximum annual debt service coverage," said Standard & Poor's credit analyst Robert Hannay. "Credit strengths also include very high maximum annual debt service coverage provided by historic receipts and further limitations to additional GARVEE debt under the Montana Highway Revenue Bond Act."
The notes are secured by an irrevocable pledge of the state's share of Title 23 federal aid transportation grants, with no backup pledge of other state funds. The series 2005 and 2008 notes were issued to finance improvements to U.S. Highway 93. Debt service on the notes is paid from federal funds received under an agreement with the Federal Highway Administration, which designates the project as an advanced construction project. The notes are not secured by a debt service reserve fund.
MDT's principal duties cover a broad array of transportation-related activities, including multimodal planning, construction and maintenance of federal aid and state highways, control of gross vehicle weights on highways under state jurisdiction, administration of rail and transit programs, and managing aeronautics facilities and programs.
RELATED RESEARCH
USPF Criteria: "Methodology And Assumptions: Rating U.S. Federal Transportation Grant-Secured Obligations," May 29, 2009
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Robert Hannay, San Francisco (1) 415-371-5038
Mary Ellen Wriedt, San Francisco (1) (415) 371-5027
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Americas Media Relations: (1) 212-438-6667
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