KBRA Affirms AAA Rating with Stable Outlook for East Goshen Municipal Authority (Township of East Goshen, PA)
17 Sep 2024 | New York
KBRA affirms the long-term rating of AAA with a Stable Outlook for the East Goshen Municipal Authority's Guaranteed Sewer Revenue Notes, which are guaranteed by the Township of East Goshen's full faith, credit, and unlimited tax pledge. As a result, KBRA's rating is based solely on the Township’s general obligation credit.
Key Credit Considerations
The rating was affirmed because of the following key credit considerations:
Credit Positives
- Strong financial management policies and procedures, which include monthly financial reporting.
- Stable underlying tax base with good commuter access to large, diverse employment centers, supporting high income and wealth levels.
- High level of financial flexibility afforded by ample reserves levels.
Credit Challenges
- General fund revenue base is somewhat dependent on earned income taxes.
The Stable Outlook reflects KBRA’s expectation that the Township will continue to achieve structurally balanced operations while preserving solid unassigned general fund reserves and governmental liquidity. The Outlook also assumes that the Authority will continue to pay debt service on the Guaranteed Notes without assistance from the Township.
Rating Sensitivities
For Upgrade
- Not applicable
For Downgrade
- Trend of GF operating deficits leading to sustained deterioration in reserve levels.
- Increase in debt burden or significant changes to the Township’s tax base.
To access rating and relevant documents, click here.