Press Release|Public Finance
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KBRA Upgrades Susquehanna Area Regional Authority Airport System Revenue Bonds to BBB+

2 Oct 2025   |   New York

Contacts

KBRA upgrades the long-term rating for the Susquehanna Area Regional Airport Authority (the Authority's) Airport System Revenue Bonds to BBB+, from BBB. The rating Outlook is Stable.

The rating upgrade reflects the Authority’s successful management of the recovery in passenger activity at Harrisburg International Airport (the Airport or MDT) following the COVID-19 pandemic. Passenger activity lagged the pre-pandemic level through most of 2024 (FYE December 31) but has exceeded prior highs in each month of 2025 through August. In KBRA’s view, this evidences a durable level of air travel demand and a continued commitment of airline partners to serve this market amid an ongoing industry-level transition from regional aircraft to higher capacity narrow-body jets and other competitive pressures.

The revised rating level is anchored by the strength and economic diversity of the air trade area, anchored by the capital of the Commonwealth of Pennsylvania, a moderately diverse carrier mix, and an experienced management team which has prioritized maintaining the Airport’s financial resiliency. Counterbalancing the aforementioned strengths is the Airport’s continued very high leverage relative to operations and the significant competition faced from nearby large airline hubs. These competitive dynamics make SARAA’s operations somewhat more vulnerable to airline decisions to reduce or eliminate service, especially during stressed economic periods.

Key Credit Considerations

The rating reflects the following key credit considerations:

Credit Positives

  • Diverse carrier mix with stable O&D base.
  • Experienced management team with demonstrated ability to maintain balanced financial operations.
  • Stable and diversified local economy anchored by the capital of the Commonwealth.

Credit Challenges

  • Very high debt levels.
  • Significant geographic competition due to proximity to major commercial airports.
  • Vulnerability to airline decisions which may impact airport operations.

Rating Sensitivities

For Upgrade

  • Reduced leverage metrics accommodated by further amortization and limited future borrowing.
  • Significant commercial and industrial development within the Airport’s primary service area leading to a higher base level of demand for air service.
  • Sustained growth in leisure passenger traffic at MDT, stimulated by Low Cost Carrier (LCC) and Ultra Low Cost Carrier (ULCC) expansion and/or organic growth of leisure demand in the Harrisburg area.

For Downgrade

  • Withdrawal of an air carrier at MDT, including one of the three legacy carriers, which results in a permanent loss of enplanements and associated revenues.
  • Additional indebtedness without commensurate growth in sources of repayment and/or a trend of weakening liquidity.

To access ratings and relevant documents, click here.

Methodologies

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1011601