KBRA Affirms A+ Rating with Stable Outlook for The Indianapolis Local Public Improvement Bond Bank Bonds, Series 2021 A
7 Feb 2025 | New York
KBRA affirms the long-term rating of A+ for the Indianapolis Local Public Improvement Bond Bank Bonds, Series 2021 A. The Outlook is Stable. The Bonds were issued by the Bond Bank and proceeds financed the purchase of securities from the Marion County Recreational Facilities Authority (the "Authority" or "MCCFRA") and the Capital Improvement Board of Managers of Marion County (the "Board" or "CIB"). The structure mirrors other Indianapolis/Marion County entities' bond issuance. Proceeds funded improvements to the Gainsbridge Fieldhouse, a downtown Indianapolis venue owned by the MCCFRA and operated by the Board that hosts sports and entertainment events.
Key Credit Considerations
The rating was affirmed because of the following key credit considerations:
Credit Positives
- Broad and diverse economic base bolsters pledged revenue performance.
- Favorable revenue growth trend pre-pandemic, and over the four most recent years.
- Sustained population growth supports enhanced economic activity.
Credit Challenges
- Bonds are secured by a variety of taxes, collections of which may at times be adversely affected by economic factors and were severely impacted by the COVID-19 pandemic.
- Lien on portion of pledged revenues has expiration date prior to bond maturity.
- Payment of the Board's obligation is subject to partial or full abatement if the facility or any portion of it is damaged and unusable.
Rating Sensitivities
For Upgrade
- Extension of lien of pledged revenues through life of bonds.
- Established trend of strong pledged revenue growth.
For Downgrade
- Additional borrowing, not currently planned, that results in a significant reduction in coverage.
- Secular declines in pledged revenues.
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