NEW ORLEANS — Solid financial strength allowed the Ernest N. Morial New Orleans Exhibition Hall Authority to maintain its AA+ bond rating from Fitch Ratings on the following special tax bonds:
–$26.4 million special tax refunding bonds, series 2012;
–$33.6 million special tax refunding bonds, series 2014.
Fitch reported that “Affirmation of the ‘AA+’ reflects a solid resilience cushion when applying both sharply lower 2020 pledged revenues and Fitch’s tourism sector revenue stress, expected strong post-pandemic pledged revenue growth, and sizeable reserves available to support debt service payments in the event of further pledged revenue declines.”
According to Fitch, the Rating Outlook is Negative, reflecting continued uncertainty regarding the timing and strength of the rebound of the tourism industry in New Orleans and the corresponding recovery in pledged tourism-related taxes. A 2027 final maturity of outstanding bonds will allow the authority to continue with its capital plan once normal business conditions resume without materially affecting the resilience cushion.”
The Fitch Group is a global leader in financial information services including credit ratings that provide valuable insights for investors in long-term debt. Fitch’s AA+ bond rating is one of the highest that can be achieved.
“We are pleased and encouraged that Fitch has chosen to maintain a rating of AA+ for our outstanding bonds, and to hold its opinion of our credit rating. Our July 15 debt payment has been reserved and is held by a trustee; therefore, it will be paid per schedule from taxes collected. It is important to note that the Authority is in compliance with all of its bond covenants, and given these very uncertain times, this rating is a tribute to how well the Authority has managed its funds,” said Michael J. Sawaya, Executive Vice President of the Authority and Convention Center President.
“Regarding the ‘negative outlook’ rating, we remain hopeful about the state of the local tourism economy and will continue to monitor the trending effects on our tax collections,” Sawaya concluded.
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