Correction: Fitch Downgrades Miami-Dade County Expwy Auth, FL Rev Bnds to 'A-'.

NEW YORK -- (This is an amended version of a press release issued earlier today, containing revised information in the headline.)

Fitch Ratings assigns an 'A-' rating to approximately $68.2 million Miami-Dade County Expressway Authority, FL (MDX, or the authority) Toll System Refunding Revenue Bonds, Series 2004A (Auction Rate Securities). Fitch also assigns an 'A-' rating to approximately $154.9 million Miami-Dade County Expressway Authority Toll System Revenue Bonds, Series 2004B. Fitch downgrades the underlying rating on $236.3 million in currently outstanding MDX toll system revenue bonds series 1996 (taxable), 1999, 2000, 2001A and 2002 to 'A-' from 'A'. The Rating Outlook for the toll system revenue bonds is Stable.

The series 2004A and series 2004B bonds are expected to be sold through negotiation on or about July 14 by a Bear, Stearns & Co. Inc.-led syndicate. Series 2004A (tax-exempt) bond proceeds will be used to refund the outstanding series 1996 (taxable) bonds. Series 2004B bond proceeds will be used fund a portion of the authority's 2005-2009 work program, pay at maturity MDX's approximately $80 million in outstanding commercial paper notes, fund an increase in the debt service reserve fund and pay the cost of issuance.

Fitch's downgrade on the toll system revenue bonds reflects a lower level of financial flexibility based on the authority's recently released finance and capital plan. MDX is projected to be increasingly leveraged as it issues additional bonds over the next several years to finance the bulk of its $857 million 2005-2009 work program, a rate of investment far in excess of historic levels. Annual debt service is forecasted to significantly escalate, while debt coverage is expected to decline to about 1.5x from around 2.0x. As a result, financial margin is largely dependent upon generating revenues from currently untolled sections of the expressway system and interest earnings. Financial operations may be further constrained as the authority takes on responsibilities for new and expanded toll facilities. Similar to the challenge faced by other toll authorities, the ability to deal with potential financial constraints through additional future toll increases may also be limited to the extent policy makers and residents perceive MDX as not adequately addressing traffic congestion.

The 'A-' rating by Fitch considers the economic strength and diversity of MDX's system of tolled highways; limited competing facilities; a track record in recent years of increasing tolls to adequately meet the authority's needs; flexibility to capture revenues from untolled sections of the expressway system and a cooperative relationship with the Florida Department of Transportation. The authority also retains a high level of economic rate making flexibility. Toll revenues more than doubled and traffic declined moderately following rate increases in fiscal 2000 and 2002. The recently implemented fiscal 2004 and planned fiscal 2006 toll increases, which are to support the financing of the authority's work program, are expected to raise revenues by another 60%.

Projected financial margin is largely dependent upon the incremental revenue to be generated by new toll plazas, particularly a new SR 836 western toll plaza, which is expected to represent about 30% of fiscal 2008 toll revenues, and interest earnings. Although this is an added risk to the authority's financial profile, revenues from the new western SR836 toll plaza are to be generated from an existing traffic base and reflect conservative traffic diversion assumptions once tolls are in place. The new toll plaza construction contract is expected to incorporate appropriate incentives and penalties to provide for the timely completion of the project.

While Fitch expressed concern in 2002 about the initial slower than expected progress on the authority's work program, activity has recently accelerated as MDX increased its capital program management functions, executed joint participation agreements with FDOT and other funding and project implementation partners and re-prioritized capital initiatives. The authority's 2005-2009 work program calls for an aggressive increase in construction activity that will need to be carefully managed. It includes roadway extensions, new connections to deal with bottlenecks, added capacity to address congestion and new toll plazas to help finance the authority's capital needs.

MDX was formed in 1994 and is a public instrumentality and agency of the State of Florida. The authority is responsible for operating, maintaining and improving an expressway system that currently includes the Airport Expressway (SR 112), the East-West (Dolphin) Expressway (SR 836), the South Dade (Don Shula) Expressway (SR 874), the Gratigny Parkway (SR 924) and the Snapper Creek Expressway (SR 878).