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Rate Covenant
(redirected from Rate Covenants)

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Rate covenant
A provision governing a municipal revenue project financed by a revenue bond issue, which establishes the rates to be charged users of the new facility.
Rate Covenant
A provision in an indenture for a revenue bond stating guidelines for the prices that the facility the bond intends to finance is allowed to charge its customers. For example, if a revenue bond finances an electric facility, a rate covenant may state that the electric company must charge enough to cover its ongoing expenses, but not so much that it is unfair to consumers.
rate covenant
A provision for a municipal revenue bond issue that sets requirements for charging revenue on the facility that is being financed by the bond issue. For example, a rate covenant might require that the rates from customers of a city sewage plant be sufficient to ensure adequate maintenance and repair for the facility. A rate covenant is included in a bond agreement to protect the bondholders' interests.
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Both coverage levels exceeded the required rate covenants of 1.
Fitch Affirms Susquehanna Area Regional Airport Auth (PA) Bonds at ... by Business Wire
The rate covenants for the senior and subordinate bonds are as follows: --Rates and charges, exclusive of connection fees, must maintain at least 120% of maximum annual debt service (MADS) on senior lien bonds; --Rates and charges, exclusive of connection fees, must maintain at least 110% of MADS on all outstanding senior and second lien bonds.
Fitch Rates DuPage County, Illinois $15.6MM Water and Sewerage Bonds ... by Business Wire
1x rate covenants, both systems are required to maintain a bond reserve at the lesser of maximum annual debt service on the bonds, 1.
Fitch Downgrades Pontiac, Michigan's Water & Sewer Bonds to 'BB-'; ... by Business Wire
 
 
 
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