The debt service
ratio has fluctuated between 10 percent and a little more than 13 percent since 1980.
Although the parties to the adversary proceeding are seeking expedited action by the Bankruptcy Court, whether the court will find for the bond trustee and whether the timing of any such decision will permit payment by the county if RACI is unable to make payment of the remaining debt service
, cannot be predicted at this time.
Fitch's gross coverage calculation (which does not net series payments or interest earnings from pledged revenues and debt service
, and as such is a more conservative calculation than that defined in the master resolution) indicates that senior debt service
coverage at its lowest point will be about 1.
In the event the city defaults in a gas price environment higher than $40 per MMBtu, debt service
payments are not at risk since payments in the flow of funds to the debt service
fund are senior to payments to the swap counterparty.
Under Fitch scenarios which project 4%-6% annual traffic increases, well below the 9% average rate of the past six years, debt service
coverage would remain under the rate covenant, and would require an estimated $1.
However, the authority continues to face a shortfall with the upcoming January 2007 debt service
SGR bondholders' claim on gross revenues is subordinate only to FGR debt service
deposits, authority administrative costs, and the FGR debt service
reserve fund (DSRF).
The rating reflects sound debt service
coverage by a first lien on solid waste resources fee (SWRF), formerly the sanitation equipment charge (SEC), revenues collected by the city, the stability of these revenues, and the city's breadth and diversity.
However, the series 2006A and series 2006B debt refunding and restructuring continues the authority's efforts beginning in 2004 to incrementally establish a more level debt service
The two-notch rating upgrade and the Stable Outlook is based solely on the strength in VVRH's sales tax debt service
subsidy, not on VVRH's hospital operations.
The underlying 'A' rating reflects the good debt service
coverage provided by pledged state deed recording fee revenues, the availability of significant other revenues that could be used to pay debt service
, if necessary, early pre-funding of debt service
, and the formal involvement of the State of South Carolina (general obligations rated 'AAA' by Fitch).