(July 9, 2015) - Citing confidence in Tampa International Airport’s growth and financial health, three bond rating agencies recently released double-A ratings for the Hillsborough County Aviation Authority’s senior revenue bonds. The high ratings mean the Authority will pay lower interest rates on its bonds and lower its annual debt service payments, putting the airport in an excellent financial position as it completes its expansion over the next two years.
Moody’s Investors Service, Standard & Poor’s Rating Services both upgraded their ratings for the Authority within the last week, listing such rationale as Tampa International Airport’s diverse revenue stream, projected passenger growth and the assistance of the $194 million grant from the Florida Department of Transportation toward its historic expansion project. Kroll Bond Rating Agency also released similar high ratings.
In its report, Moody’s cited the airport’s strong, conservative management and noted that the airport “is at the beginning of a capital program that will transform the airport and leave the airport’s finances in a position as strong as it has ever been.” Moody’s also wrote that it expects the airport to outperform passenger growth forecasts in the near term due to the national economic recovery, solid growth in the tourism and leisure industries and high-wage job growth in our region.
Standard & Poor’s report mentioned several factors that went into its upgrade, including the airport’s “good carrier mix and a strong management team,” as well its “well-defined capital improvement program in place, allowing it to meet air travel demand while maintaining good financial margins.”
Kroll called the airport’s capital plan “thoughtful and flexible” and cited such Authority core values as professionalism, partnership, transparency, credibility, efficiency and customer focus. Those values, Kroll said, underscore the Authority’s commitment to “implementing capital improvements that are economically beneficial, and environmentally and socially responsible.”
The new ratings come on the heels of the July 2 Aviation Authority Board meeting in which the board approved three bond issues totaling $825 million to pay for master plan projects.
After receiving news of the Moody’s report at the July 2 board meeting, Authority Board Chairman Robert Watkins praised the airport’s finance department for a job well done.
“The upgrade itself is the result of everybody on this team and the work of the Authority,” Vice President of Finance Damian Brooke responded. “The additional passenger traffic and the way this team manages the project – it all contributed.”
Added Brooke: “The rating upgrades put Tampa International Airport in rarefied air. Only about a dozen airports nationwide hold double-A bond ratings and most of those are much larger hub airports.”
Moody’s: Senior lien revenue bonds to Aa3 from A1; subordinate lien revenue bonds to A1 from A2.
S&P: Senior long-term rating and underlying rating to AA- from A+; long-term rating to A+ from A on subordinated series bonds.
Kroll: Long-term rating of AA- with a stable outlook on senior bonds; long-term rating of A+ with a stable outlook for subordinated revenue bonds.