Fitch Rates Kentucky Asset/Liability Commission $150MM TRANs 'F1+'.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 assigns an 'F1+' rating to the Kentucky Asset/Liability Commission's approximately $150 million general fund tax and revenue anticipation notes Revenue Anticipation Note (RAN) A short-term municipal debt issue that will be repaid with anticipated revenues, such as sales taxes, from the project. (TRANs, or the notes), 2006 series A. The TRANs, due June 28, 2007 and not callable Callable Applies mainly to convertible securities. Redeemable by the issuer before the scheduled maturity under specific conditions and at a stated price, which usually begins at a premium to par and declines annually. , will sell through negotiation with Citigroup on or about June 21. Fitch also affirms the 'F1+' rating of the commission's outstanding $600 million 2005 series A TRANS, due June 28, 2006. The TRANs will be used to finance Kentucky's fiscal-year (FY) 2007 cash flow needs. The notes have a priority lien on all general fund revenues. The 'F1+' rating is based on the strength of the security, the significant amount of other state moneys that may be borrowed by the general fund, and the good coverage to be provided by remaining general fund balances. Projected general and available budget reserve trust fund balances approximate $630 million, resulting in 4.2 times (x) coverage of TRAN TRAN Transmit TRAN Transient TRAN Tax Revenue Anticipation Note TRAN Dow Transport Index TRAN Transport Layer repayment requirements in June 2007. While Commonwealth projects a fiscal 2006 budget reserve fund balance of $119 million, up from $28.8 million in FY2005, statute stipulates in the event of a revenue shortfall that only 25% of the fund's balance be available in the first fiscal year of a biennium bi·en·ni·um n. pl. bi·en·ni·ums or bi·en·ni·a A two-year period. [Latin : bi-, two; see bi-1 + annus, year; see at- . TRAN proceeds will approximate 1.6% of projected general fund cash flows in FY2007. A general fund and available budget reserve trust fund cash balance of nearly $630 million, or 6.7% of cash flows, is projected at the end of the fiscal year following note repayment. FY2006 cash flow operations have substantially exceeded projections developed when last year's notes were sold, owing primarily to higher revenues. Sales, corporate income, coal severance taxes severance tax n. A tax imposed by a state on the extraction of natural resources, such as oil, coal, or gas, that will be used in other states. , and lottery revenues, along with a higher than estimated carryover surplus from fiscal 2005, offset lower personal income tax collections and higher disbursements. Consequently, a $717.5 million ending cash balance, excluding the budget reserve, is estimated for June 30, 2006, compared to the $37 million projection last year. Average borrowable cash balances in other funds were more than $1.6 billion in the first 10 months of FY2006, up from the $1.05 billion of one year ago. Borrowable funds create a significant additional cushion, increasing coverage of note repayment requirements to 15x. Kentucky's economy is improving slowly, contributing to increasing state revenues. Between 2000 and 2003, employment in the state declined 2.3%, which was more than the national rate of job loss. In 2004 the economy began to recover and posted 1.5% gain in 2005. Through May 2006 employment was up a 1.2% over a year ago compared to the 1.4% national expansion. Despite growth, 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. personal income over the last 10 years has consistently been 82% of the U.S. average for this measure and currently ranks 42nd among the states. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other 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 the 'Code of Conduct' section of this site. |
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