Printer Friendly
The Free Library
5,677,581 articles and books
Member login
User name  
Password 
 
Join us Forgot password?

Fitch Rates Florida's $238MM GO Capital Outlay Rfdg Bonds 'AA+'.


NEW YORK New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of
 -- Fitch Ratings Fitch Ratings

An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris.
 assigns an 'AA+' rating to approximately $238.4 million State of Florida full faith and credit state board of education capital outlay capital outlay

See capital expenditure.
 refunding bonds refunding bond

A bond that is issued for the purpose of retiring an outstanding bond. Issuers refund bond issues to reduce financing costs, eliminate covenants, and alter maturities. See also crossover refunding bonds, prerefunding.
, 2005 series B, expected to sell competitively on July 13. Fitch also affirms its 'AA+' rating of approximately $12 billion outstanding Florida full faith and credit bonds.

Florida's general obligation bond rating, upgraded to 'AA+' on March 3, 2005, reflects a moderate debt burden, sound financial management practices, sizable siz·a·ble also size·a·ble  
adj.
Of considerable size; fairly large.



siza·ble·ness n.
 reserves, and a robust, broad, service-based economy. Florida's full faith and credit bonds also carry a pledge of specific taxes for each type of debt. The state targets debt service levels equal to 6% of revenues. Key credit risks include large, primarily growth-related capital needs, especially for schools, and rapid growth of Medicaid spending, which must be contained.

Soaring state revenues have contributed to accumulation of large reserves. The state prudently has limited their use for operating expenditures. The stabilization fund Stabilization fund may refer to:
  • Exchange Stabilization Fund
  • Stabilization Fund of the Russian Federation
  • Petroleum Fund of Norway (SPF)
  • Chile's Copper Stabilization Fund (CSF)
  • Oman's State General Reserve Fund (SGRF)
, now about $1 billion, was held intact during the recession. Receipts surged in fiscal 2004, and combined budget stabilization and working capital balances grew to $3.5 billion, or 14.5% of revenues. Revenue projections recently were increased again, and fiscal 2005 is projected to end with $4 billion in balances, or 16.4% of revenues. This does not include a $1.7 billion fund balance in an endowment funded Noun 1. endowment fund - the capital that provides income for an institution
endowment

patrimony - a church endowment

chantry - an endowment for the singing of Masses
 from tobacco settlements for health purposes.

The governor approved the fiscal 2006 budget on May 26, vetoing $69 million of legislatively approved general revenue appropriations. The budget, as approved by the governor, reportedly keeps reserves at significant levels, using some, consistent with past practices, for non-recurring and recurring re·cur  
intr.v. re·curred, re·cur·ring, re·curs
1. To happen, come up, or show up again or repeatedly.

2. To return to one's attention or memory.

3. To return in thought or discourse.
 expenditures. The plan adds $92 million to the budget stabilization fund. Official, more detailed estimates are not yet available.

On April 11, the state's estimating conference increased general revenue forecasts for fiscal years 2005 and 2006 by another $1.1 billion for each year. In November 2004, the group had increased the fiscal 2005 forecast by $1.6 billion. Broad-based strength in consumer spending Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. , business activity, construction, and real estate led to significant increases in projections for receipts of sales, documentary stamp, intangibles, and corporate income taxes. Fiscal 2005 general revenues have been forecasted to be 13% above those of fiscal 2004; fiscal 2006 revenues have been projected to climb another 3.8%.

Florida's economy continues its strong performance. In 2004, employment grew by triple the national rate, and for the 12 months ended May 2005, by 2.9%, significantly above the 1.5% national rate for the same period. Measures of wealth remain average; personal income per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals.  now ranks 23rd among the states at 96% of the U.S. level. Visitation VISITATION. The act of examining into the affairs of a corporation.
     2. The power of visitation is applicable only to ecclesiastical and eleemosynary corporations. 1 Bl. Com. 480; 2 Kid on Corp. 174.
 has rebounded from the downturns of 2001-2002 and the 2004 hurricanes.

Debt places only a moderate burden on Florida's resources. Tax-supported debt equals about 3.4% of personal income and consumes about 6% of revenues. Funding class size reduction will be a challenge in future years. Estimates of capital costs for this purpose have ranged as high as $9.4 billion.

Florida's full faith and credit capital outlay bonds are paid primarily from motor vehicle license taxes. For school and community college districts with participation in these bond issues, the number of instruction units must be set at a level to generate revenues of no less than 1.12 times (x) annual debt service. Districts receive funds for capital outlay pursuant to the constitution before excesses are made available to state transportation funds. Fiscal 2004 aggregate capital outlay distributions for districts from this source cover projected maximum annual debt service (MADS) by 1.18x; total motor vehicle license tax revenues cover MADS by 5.79x. License tax revenues grew by an average 5% per year between 1994 and 2004 and by 4.8% in fiscal 2004; 5.3% growth was forecast in fiscal 2005, and 3.8% is expected in fiscal 2006.

The 2005 series B bonds will mature Jan. 1, 2006-2020, with a term bond option, subject to optional redemption beginning Jan. 1, 2015.

Fitch's rating definitions are available on the agency's public web site, www.fitchratings.com. Published ratings, criteria and methodologies and relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental  are also available from this site, at all times. This document will remain on the public site for seven days.
COPYRIGHT 2005 Business Wire
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2005, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

 Reader Opinion

Title:

Comment:



 

Article Details
Printer friendly Cite/link Email Feedback
Publication:Business Wire
Date:Jul 12, 2005
Words:718
Previous Article:Fitch Upgrades Select Argentine Corporate Ratings.
Next Article:Corrections Corporation of America Announces Date for Second Quarter 2005 Earnings Release and Conference Call.



Related Articles
Fitch Ratings Downgrades Four Toronto-Dominion Supported Issues.
Fitch Places ACA Finl Gty on Rating Watch Negative - Affected Bonds List - 1 of 4.
Fitch Places ACA Finl Gty on Rating Watch Negative - Affected Bonds List - 3 of 4.
Florida $22MM Education Capital Outlay GOs Rated 'AA' by Fitch.
Fitch Rates Leon County Schools, Florida's $25.6MM Rfdg COPs 'AA-'; Upgrades GOs.
Fitch Rates Duval County School Board, Florida $38MM COPs 'A+'.
Fitch Rates $297MM Florida GO Capital Outlay Bonds 'AA+'.
Fitch Rates University of South Carolina Bonds 'AA'.
Fitch Rates State University System of Florida Rev Bonds 'AA'; Stable Outlook.
Fitch Rates Volusia County School Board, Florida COPs 'A+'; Outlook Stable.

Terms of use | Copyright © 2009 Farlex, Inc. | Feedback | For webmasters | Submit articles