Standard & Poor's Ratings Services said it has raised its ratings on the Sienna Plantation Levee Improvement District, Texas's existing general obligation debt to A-minus from BBB-plus.
The outlook on all ratings is stable.
"The upgrade reflects our view of the district's moderating overall net debt burden due to the district's rapidly increasing tax base," said Standard & Poor's credit analyst Ann Richardson.
The ratings reflect the district's: participation in the deep and diverse economy of the Houston metropolitan statistical area; very strong financial position; and very low direct tax rate.
The rating is constrained by the district's high debt burden.
The bonds are secured by an unlimited ad valorem tax levied on all taxable property within the district.
The stable outlook reflects the opinion that the district will continue to maintain its very strong financial position through continued healthy property tax collections. The outlook further reflects the view that the rapid AV growth will likely keep the debt burden manageable and commensurate with the A-minus rating. While the agency does not view it as likely to occur within the two year-outlook horizon, if there is a material increase in the overall debt burden without sufficient property tax base growth, the agency could lower the rating. It could raise the rating if the debt burden moderates substantially.
Sienna Plantation Levee Improvement District encompasses approximately 9,832 acres and is about 22 miles southwest of Houston's central business district. The district is entirely within the bounds of Fort Bend County, and is served by Fort Bend Independent School District. It is in the growing stages of development. The district contained about 5,719 completed single-family homes as of March 1, 2012.
