MOODY'S REPORT, in part
Rating Action: Moody's assigns Baa2 to Burlington (City of) VT Airport Enterprise's Airport Revenue Refunding Bonds, Series 2021A (taxable); stable outlook
22 Feb 2021
New York, February 22, 2021 -- Moody's Investors Service, ("Moody's") has assigned a Baa2 rating to the Burlington (City of) VT Airport Enterprise's $5.385 million Airport Revenue Refunding Bonds, Series 2021A (taxable). The outlook is stable. Burlington Airport has $26.1 million of Series 2012A and 2014A bonds outstanding, as well as $11.1 million of Revenue Anticipation Notes issued by the City of Burlington.
RATINGS RATIONALE
The Baa2 rating reflects the continued stability in liquidity and debt service coverage, combined with a strengthened cost recovery framework following the adoption of a multi-year airline agreement that is residual in nature and provides for a 1.50x debt service coverage ratio (DSCR) and a floor of 200 days cash on hand. The credit profile will remain supported by limited competition for Burlington's primary O&D passenger base, a stable cost profile, and a relatively low debt burden. The airport anticipates no new debt to fund capital projects, and has a manageable planned capital investment program. We expect the service area's long-term growth prospects to remain modest, given the City of Burlington's status as a regional economic center with institutional anchors represented by government, health care and higher education will sustain a solid level of air travel demand under normal circumstances, which the airport is well-positioned to serve.