JACKSON — Fitch Ratings has affirmed the Jackson Municipal Airport Authority’s (JMAA’s) approximately $45-million revenue refunding bonds series 1998, 2005 and 2007 at “A-.”
The bonds are secured by a pledge of general airport revenues collected at the airport, after payment of operating and maintenance expenses, on a first lien pari passu basis.
The rating outlook on all authority bonds is “stable.”
Fitch said the “A-” rating “reflects the lack of significant competing facilities within the air service area, the authority’s consistently healthy financial performance characterized by stable operating margins, adequate liquidity, low debt levels and minimal near-term capital needs.”
Fitch noted, however, that “project implementation is dependent on demand and available funding. Fitch also notes that JMAA’s debt service reserve fund is currently held in the form of an AMBAC reserve fund credit and that management has no current plans to cash fund the debt service reserve fund requirement. Should the decrease in enplanements persist and/or management fails to control operating cost growth going forward, debt service coverage and airline costs will be pressured and negative rating action could follow.
“Authority finances are healthy, particularly characterized by its strong generation of non-aeronautical revenues over the past five years.
“The airport’s current five-year capital improvement plan totals $95 million through to fiscal 2014 and will fund a mix of airfield and terminal side rehabilitation projects. These capital projects are being or will be funded from federal and state grants, passenger facility charges (PFCs) and other available funds of the authority. At this time, JMAA does not expect to issue any new debt in the short term.”
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