MOODYS ASSIGNS Aa1 RATING TO NEW MEXICO'S FINANCE AUTHORITY SENIOR LIEN STATE TRANSPORTATION REFUNDING REVENUE BONDS SERIES 2010A-1 AND Aa2 RATING TO SERIES 2010A-2 SUBORDINATE LIEN BONDS; OUTLOOK IS STABLE

Posted on: August 20, 2010, 3:17 pm

NEW YORK, Aug 20, 2010 -- Moody's Investors Service has assigned a Aa1 rating to the $110 million New Mexico Finance Authority Series 2010A-1 State Transportation Refunding and Revenue Bonds (Senior Lien) and a Aa2 rating to the $90 million Series 2010A-2 Subordinate Lien Refunding and Revenue Bonds. The ratings reflect the bonds' lien position on pledged revenues after payment of debt service on the approximately $26 million of prior State Transportation Commission debt (closed lien obligations) issued under a separate indenture, healthy debt service coverage provided by a large, diverse and relatively stable pledged revenue stream including both state and federal revenues sources, an additional bonds test for the senior lien bonds of 3.5 times based on total pledged revenues and 3 times based on pledged state revenues, an additional bonds test for the subordinate lien bonds of 3 times based on total pledged revenues, the essential purpose served by the State Road Fund (SRF), and a statutory non-impairment pledge by the state, which limits the risk of significant diversion of pledged revenue away from the SRF. Bond proceeds will be used to refund and terminate a $120 million outstanding line of credit provided by Bank of America and fund roughly $80 million of new transportation projects. The outlook for the bonds are stable...

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