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KBRA Affirms A+ Rating for Hillsborough County Aviation Authority, FL Tampa Int'l Airport CFC Bonds; Outlook is Stable

16 Aug 2023   |   New York

Contacts

KBRA affirms A+ rating with Stable Outlook for Hillsborough County Aviation Authority, FL Tampa Int'l Airport CFC Revenue Bonds.

Key Credit Considerations

The rating was affirmed because of the following key considerations:

Credit Positives

  • Legal framework provides strong bondholder protections and features a 1.25x rate covenant (excluding rolling coverage), ability to adjust the CFC, and established reserves.
  • The Tampa Bay area is an established and popular leisure/recreation destination that supports high levels of rental car utilization.
  • Passenger activity at TPA has rebounded well from the sharp reductions recorded during the COVID-19 period.

Credit Challenges

  • Sizable leisure/recreation component represents vulnerability to economic downturns, as evidenced by sharp enplanement and rental car transaction declines during the COVID-19 pandemic.
  • Competitive market for leisure/recreation destinations and potential for shifts in consumer preferences may reduce demand for rental cars at Tampa International Airport (TPA)
  • Competition from rideshare services may weigh negatively on CFC revenue growth going forward.

Rating Sensitivities

For Upgrade

  • Trend of steady growth in rental car transactions resulting in sustained increase in pledged revenues.

For Downgrade

  • Erosion in rental car market and rental car transactions pressuring debt service coverage.

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.

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