MOODY'S AFFIRMS Baa3 RATING ON RICHMOND (CA) REDEVELOPMENT AGENCY 2000 TAB

Posted on: December 22, 2009, 5:31 pm

NEW YORK, Dec 22, 2009 -- Moody's Investors Service has affirmed the Baa3 rating on the Richmond Joint Powers Financing Authority Tax Allocation Revenue Bonds Series 2000A and Housing Set-Aside Tax Allocation Revenue Bonds Series 2000B. The bonds are secured by loan payments which in turn are secured by a pledge of tax increment revenues, including housing set-aside revenues for Series 2000B, derived from a group of sub-areas collectively known as the "Pre-2004 Limit Area." The rating recognizes as a positive credit factor the bonds' relatively sizable assessed value (AV) which is comprised nearly entirely of incremental AV, dampening debt service coverage volatility. Concentration of AV among top ten taxpayers is moderate. Debt service coverage, though not extraordinarily strong, is sound and is protected from dilution because the lien occupied by these bonds is closed. These credit strengths are offset by the substantial AV decline that the Area experienced in fiscal 2010. AV could well decline further in the coming year, though Moody's believes such a decline most likely will be smaller. Also, the RDA needs to contend with a sizable amount of subordinate Auction Rate debt currently outstanding. Doing so will likely render the RDA unable to meet its legislative requirement, currently being challenged in court, to shift revenues to the state...

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