NEW YORK - Standard & Poor's Ratings Services said it has lowered its long-term rating on the Rhode Island Turnpike and Bridge Authority's (RITBA or the authority) series 2003A taxable refunding revenue bonds to A-minus from A. At the same time, Standard & Poor's assigned its A-minus long-term rating to the authority's $50 million revenue bonds series 2010A. The outlook is stable.
"The downgrade reflects our view of RITBA's increasing renewal replacement costs and the impact of rising capital requirements on the authority's debt service coverage, liquidity, and debt levels," said Standard & Poor's credit analyst Kurt Forsgren.
The ratings reflect Standard & Poor's view of historically strong financial results, RITBA's demonstrated willingness to increase revenues to address critical long-term system maintenance requirements, and Newport Bridge's good business position.
RITBA plans to issue the series 2010A bonds to pay for certain capital projects identified and approved in the 10-year bridge system plan.
The authority is responsible for operating a two-bridge system, consisting of the Newport and Mount Hope bridges. Both provide access to Aquidneck Island and the community of Newport.
The Newport Bridge, which opened in June 1969, is an 11,248-foot long suspension bridge that carries four-lanes of vehicular traffic on Route 138 over the East Passage of Narragansett Bay, connecting Jamestown on Conanicut Island and Newport on Aquidneck Island. Tolls are collected on traffic in both directions. The Mt. Hope Bridge is a 4,858-foot long, two-lane suspension bridge that opened in 1929 and connects Bristol and Portsmouth. It became toll-free in 1998.
The stable outlook reflects RITBA's current financing plan, toll structure, and projected traffic and revenue performance. Significant cost increases or deviations from expected demand levels, lower revenues, or higher operating expenses would be cause for ratings concern.
