Bangkok--24 Aug--Standard & Poor's
Standard & Poor's Ratings Services assigned its a 'AA+' long-term rating and stable outlook to Utah State Building Ownership Authority, Utah's lease revenue bonds (state facilities master lease program) series 2009C, D, and E, which were issued on behalf of Utah. In addition, Standard & Poor's affirmed its 'AA+' long-term rating on the authority's series 2009B lease revenue bonds, which were also issued on behalf of the state.
"The rating reflects Utah's good financial management, especially its proactive budget adjustments to maintain good financial reserves," said Standard & Poor's credit analyst Misty Newland. "In addition, the state maintains a low debt burden with short maturity schedules and boasts a young, well-educated workforce and diverse economy."
The series 2009B and 2009C bonds will fund the state's Department of Alcoholic Beverage Control and related facility project, while the series 2009D and 2009E bonds will fund the construction and expansion to the Huntsman Cancer Hospital.
Utah's active management of recent structural budget challenges and current reserve levels somewhat mitigates the uncertainty of the current economic environment, which could present further downward pressure on revenues. Additionally, given the state's use of one-time stimulus funding to soften its budget reductions, if the economy, and thus revenues, do not rebound sufficiently to offset the loss of stimulus funds, we expect that the state would continue to make budget adjustments that maintain a level of flexibility that has contributed to the current rating.
The state is planning to issue about $1 billion in general obligation (GO) bonds during the next 12 months. Bonds have been authorized for transportation projects, and management has stated that the bond program issuance schedule would likely span about three years.
RELATED RESEARCH
USPF Criteria: "GO Debt," Oct. 12, 2006
USPF Criteria: "Appropriation-Backed Obligations," June 13, 2007
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Misty Newland, San Francisco (1) 415-371-5073
David G Hitchcock, New York (1) 212-438-2022
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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