Press Release|Public Finance
KBRA Affirms AA- Rating with Stable Outlook for The Turnpike Authority of Kentucky Economic Development Road Revenue Bonds (Revitalization Projects)
19 Sep 2023 | New York
KBRA affirms the long-term rating of AA- with a Stable Outlook for the Turnpike Authority of Kentucky Economic Development Road Revenue Bonds (Revitalization Projects).
Key Credit Considerations
The rating was affirmed because of the following key credit considerations:
Credit Positives
- The revenues that provide for lease rental payments can only be used for transportation purposes.
- The Commonwealth’s use of lease financing is the primary funding mechanism for essential purpose road and highway infrastructure.
Credit Challenges
- Wealth and income metrics lag the region and the U.S.
- Road Fund revenues are subject to economic volatility, although there is a statutory floor on motor fuel tax revenues.
Rating Sensitivities
For Upgrade:
- Material improvement in debt service coverage due to an increase in available Road Fund Revenues and/or a reduction in annual debt service.
- The imposition of additional covenants that provide further bondholder protection.
For Downgrade:
- Wealth and income metrics lag the region and the U.S.
- Road Fund revenues are subject to economic volatility, although there is a statutory floor on motor fuel tax revenues.
To access rating and relevant documents, click here.