Fitch Rates Tennessee Local Development Authority $35MM BANs '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 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 'F1+' rating to $35 million Tennessee Local Development Authority (the authority) state loan programs revenue bond anticipation notes Bond anticipation note (BAN) A short-term debt instrument issued by a state or municipality to borrow against the proceeds of an upcoming bond issue. (BANs), 2006 series A, affirms the 'F1+' rating of $45.5 million outstanding 2005 series A authority BANs, and affirms the 'AA-' rating of $63 million in outstanding program revenue bonds. Selling competitively on or after May 3 and due May 17, 2007, with interest payable at maturity, the new issue will principally be used for loans to localities for sewage treatment Sewage treatment Unit processes used to separate, modify, remove, and destroy objectionable, hazardous, and pathogenic substances carried by wastewater in solution or suspension in order to render the water fit and safe for intended uses. and waterworks waterworks: see water supply. purposes and to retire the outstanding BANs, along with other available funds. The highest short-term rating for the BANs reflects the credit of the authority's local government loan programs and their ability to access the bond markets for financing. The security includes a pledge of future proceeds of the authority's 'AA-' rated revenue bonds and certain payments made by local governments under loan agreements. BAN interest is paid from local loan repayments and other available authority funds. The authority has accessed the debt markets since 1982, and $63 million of revenue bonds are outstanding. Loans are used by local governments to fund water and sewer utility improvements. Numerous features support the loan program's credit. Loan underwriting standards are conservative. Committed local sources to pay loans provide at least 1.10 times coverage of debt service. The loan agreements also include a pledge of localities' allocations of state shared taxes, including gas, sales, investment income, and mixed drink taxes, as well as certain Tennessee Valley Authority Tennessee Valley Authority (TVA), independent U.S. government corporate agency, created in 1933 by act of Congress; it is responsible for the integrated development of the Tennessee River basin. payments to the state. Withholding of these shared taxes would occur upon failure of the borrower to make a required payment. State law also provides funding, from any available source, of a trust fund equal to each borrowing localities' annual loan obligations less its unobligated state shared taxes. Statute requires the governor to request an appropriation for this requirement. The reserve currently exceeds $3 million; however, it may be drawn down to 200%, or $351,078, of the required reserve level. Payments by local units have always been made as scheduled, and there has been no need for recourse to either the state-shared taxes or the statutory reserve. Nashville-Davidson and Trenton counties will likely receive a majority of the funding from a portion of the BAN proceeds. Forty other local units have program loans financed by authority bond issuance. 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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