Moody’s Investors Service downgraded to Baa1 its underlying rating on Bishop International Airport.

The rating change affects $28.1 million of revenue bonds, including $7.3 million of debt the airport recently refunded.

The  outlook is negative even at the lower rating, according to Moody’s analysts.

“The negative outlook reflects potential for further declines in the economic strength of the service area, as well as the potential for enplanement reductions following Southwest Airline’s announcement to acquire the airport’s primary airline, Airtran Airways,” analyst Michael O’Connor wrote in a report on the downgrade.

Bishop is located in Genesee County in southeast Michigan. It has been struggling with a declining fiscal position due in part to depressed travel trends as well as competition from nearby Detroit Metropolitan Airport.

Credit strengths include the airport’s ability to levy a property tax in Genesee County, which broadens its revenue stream, as well as low airline cost of enplanement, strong liquidity, and limited capital needs, Moody’s said.

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