KBRA Assigns AA- Rating to City of Austin, TX Airport System Revenue Refunding Bonds, Series 2025 (AMT); Affirms Rating for Outstanding Airport System Revenue Bonds

KBRA assigns a long-term rating of AA- to the City of Austin, TX Airport System Revenue Refunding Bonds, Series 2025 (AMT). KBRA additionally affirms the long-term rating of AA- for the City's outstanding Airport System Revenue Bonds. The rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• Vibrant underlying economy featuring large public institutions (State Capital, University of Texas) and a deep and diverse array of private sector employers that have and continue to make sizable investments in the area.
• Established enplaned passenger growth trend.
• Well-managed financial operations characterized by high debt service coverage and substantial liquidity.

Credit Challenges

• Rapid passenger activity growth necessitates large capital program.
• Large, multi-year capital program entails construction, implementation and execution risks.

Rating Sensitivities

For Upgrade

• A rating upgrade is not anticipated over the near-term given plans for sharply increased leverage under the Airport Expansion Development program, but completion of the program within the expected timeline and budget accompanied by continuing strong enplanement growth and moderation of the anticipated debt burden over time could result in upward rating movement.

For Downgrade

• Significant additional debt issuance beyond the scope of identified projects, that sharply increases debt metrics.

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: U.S. General Airport Revenue Bond Rating Methodology
• ESG Global Rating Methodology

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: 1008540

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