Press Release|Public Finance
KBRA Affirms AAA Rating for Los Angeles County Metropolitan Transportation Authority Proposition A First Tier Senior Sales Tax Refunding Bonds, Series 2018-A
15 Mar 2024 | New York
KBRA affirms the long-term rating of AAA with a Stable Outlook for Los Angeles County Metropolitan Transportation Authority’s (LACMTA) Proposition A First Tier Senior Sales Tax Revenue Refunding Bonds, Series 2018-A.
Key Credit Considerations
Credit Positives
- Sizable and diverse economic base that exhibits continued growth and ranks as the nation’s most populous county.
- Pledged Proposition A Sales Tax Revenues provide ample coverage of maximum annual debt service requirements. The solid rebound in sales tax revenues following the pandemic-related decline in FY 2020 demonstrates the resilience of the sales tax base, as does recovery from recessionary decline.
- Gross revenue pledge with sales taxes collected by State Department of Tax and Fee Administration and directly deposited with Trustee.
Credit Challenges
- First Tier Senior Sales Tax Obligations are solely secured by Proposition A Sales Tax Revenues, which may at times be adversely affected by reduced economic activity related to exogenous shocks.
- Although unlikely, possible legislative or voted changes may impact the items subject to the State’s general sales tax and by extension, the Proposition A Sales Tax.
Rating Sensitivities
For Upgrade
- NA
For Downgrade
- Significant secular economic downturn that results in sharp, prolonged reductions in pledged Proposition A Sales Tax Revenues and debt service coverage.
To access rating and relevant documents, click here.