Press Release|Public Finance

KBRA Affirms A+ Rating to Allegheny County Airport Authority (Pittsburgh International Airport); Outlook is Stable

27 Jul 2023   |   New York


KBRA affirms the long-term rating of A+ with a Stable Outlook to the Allegheny County Airport Authority (Pittsburgh International Airport) Airport Revenue Bonds.

Key Credit Considerations

The rating was affirmed because of the following key credit considerations:

Credit Positives

  • Innovative leadership team that is focused on maintaining competitive airline costs through revenue diversification, new product offerings and pricing structures, and expenditure controls .
  • Absence of airline concentration, unique non-aviation revenue sources which can be applied on a discretionary basis, and the origin and destination nature of Airport activity aid in stability.
  • The diversified regional economy benefits from a relatively young, highly educated workforce, low unemployment, and growth in strategic employment sectors, although persistent population decline somewhat offsets these positive demographics.

Credit Challenges

  • The Authority is exposed to construction risk and execution risk on the $1.35 billion TMP.
  • Projected leverage is high and debt metrics are expected to be stressed throughout the forecast period.
  • Certain revenues that may be deemed “Other Pledged Revenues” under the Master Trust Indenture are volatile.

Rating Sensitivities

For Upgrade

  • Completion of the TMP and concurrent projects on time and within budget, enabling recognition of anticipated operating cost savings and maintenance of manageable airline costs.
  • Strong traffic recovery and subsequent sustained growth that results in reasonable coverage margins and moderate airline costs.

For Downgrade

  • Construction cost escalation or delays that entail significant cost overruns.
  • Weak recovery in passenger traffic necessitating significant increases in airline costs.

To access rating and relevant documents, click here.


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