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Texas Transportation Commission - Moody's Research Report

MOODY'S ASSIGNS Aaa RATINGS TO $1.5 BILLION OF TEXAS STATE HIGHWAY FUND REVENUE BONDS ISSUED BY THE TEXAS TRANSPORTATION COMMISSION

Posted on: July 19, 2010, 11:42 am

NEW YORK, Jul 19, 2010 -- Moody's Investors Service has assigned Aaa ratings to the Texas Transportation Commission's $115.5 million State Highway Fund First Tier Revenue Bonds, Series 2010A and $1.4 billion Taxable Series 2010B (Build America Bonds-Direct Payment) expected to price on July 27. Concurrently, we have affirmed the Aaa ratings assigned to $2.7 billion of outstanding parity bonds, and the A1 rating assigned to $233 million of outstanding pass-through toll transportation revenue bonds issued by the Camino Real Regional Mobility Authority. The highest quality rating reflects the strong debt service coverage provided by a pledged revenue stream that includes both state and federal funds; Texas' favorable economic and demographic trends, especially related to motor vehicle use; a bond resolution leverage constraint that provides good bondholder protections but that is diluted by the inclusion of federal funds, buttressed by a stricter leverage constraint set in statute; and constitutional dedication and appropriation of the pledged revenue stream. The outlook is stable...

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