Regional News

Airport to Sell $26M

Following a downgrade from Fitch Ratings, Burlington, Vt., is planning to sell $26.4 million of airport refunding revenue bonds this week.

About $19.4 million of Burlington’s outstanding airport refunding revenue bonds were downgraded to BBB-minus from BBB and Fitch applied the rating to the new bonds.

“The downgrade reflects the airport’s elevated risk profile resulting from anticipated traffic declines and concerns that traffic volatility can further constrain the airport’s already limited operating and financial flexibility,” analysts said in a report.

The Burlington International Airport, in South Burlington, has maintained a mix of regional and commuter carriers, including US Airways and United Airlines. However, enplanements at the airport have been narrow, with around 653,000 in fiscal year 2012.

Jefferies & Co. will price the airport’s refunding bonds, which will be used to refinance outstanding 1997A, 1997B, and 2000 bonds, as well as repay a $12 million bond anticipation note due in Dec. 2012.

Overall present value savings on the refinanced bonds are expected to be around 1.5%.

The bonds are special obligations of the city, payable from a senior lien pledge from the airport’s net revenues. Around 47% of total operating revenue is generated from the airport’s parking operations.     




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