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KBRA Affirms AA Rating for City of Salt Lake, UT Airport Revenue Bonds

28 Jun 2024   |   New York

Contacts

KBRA affirms the long-term rating of AA with a Stable Outlook for the City of Salt Lake, UT Airport Revenue Bonds.

Key Credit Considerations

The rating action reflects the following key credit considerations:

Credit Positives

  • Experienced management team, with a demonstrated ability to implement a complex, multi-year capital program.
  • Economically diverse air trade area supporting robust business and leisure travel demand.
  • Continued manageable airline costs and healthy liquidity, though New SLC implementation has had some impact.

Credit Challenges

  • Significant reliance on Delta for enplanement activity.
  • Elevated near term debt metrics, which are expected to improve over time through anticipated enplanement growth and limited future debt.

Rating Sensitivities

For Upgrade

  • More rapid reduction in leverage than anticipated, resulting in lower airline costs and higher coverage.
  • Material increase in liquidity following New SLC implementation.
  • Significant, sustained growth in origination & destination traffic.

For Downgrade

  • While not expected, additional borrowing beyond what is currently contemplated to complete the New SLC.
  • Substantial reduction in passenger traffic stemming from structural changes to Delta’s hubbing strategy.

To access rating 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) is a full-service credit rating agency 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 by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1004936