NEW YORK - Moody's Investors Service said it has downgraded to A1 from Aa3 the rating on the Burbank-Glendale-Pasadena Airport Authority, Calif.'s ("BGPAA") revenue bonds.
Moody's also assigned an A1 rating to the authority's $8.1 million 2012 Series A and $74.7 million 2012 Series B revenue bonds backed by customer facility charge revenues (CFC). The outlook has been revised to negative.
The rating reflects BGPAA's increased leverage profile, tighter financial flexibility and an ongoing transition from historically robust debt service coverage ratios to lower ratios that will continue to be pressured in the medium term.
The rating also incorporates the authority's strong liquidity position, prudent management and the maintenance of a very competitive cost structure, mitigating the threat presented by four other airports serving the greater Los Angeles area.
The authority operates Bob Hope Airport ("BHA").
The outlook is negative based on the increased leverage profile amid an environment of negative enplanement trends expected to continue over the next fiscal year, prior to returning to stabilization and growth.