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Fitch Affirms Bastrop, Texas' GOs at 'A+'; Outlook Stable
NEW YORK-(Business Wire)-September 5, 2008 - In the course of routine surveillance, Fitch Ratings has affirmed the 'A+' rating on approximately $4.5 million in outstanding general obligation (GO) bonds issued by Bastrop, Texas (the city). The Rating Outlook is Stable.
The 'A+' rating reflects the city's sound financial position evidenced by healthy fund balances in the face of growth pressures and the city's ongoing economic development. However, credit concerns include the vulnerability of sales taxes to economic fluctuations, the largest source of general fund revenues, continued dependence on subsidies from the city's utility system, and relatively high direct and overlapping debt levels considering its limited economy. The Stable outlook reflects Fitch's expectations that Bastrop's proximity to Austin will help it maintain strong taxable assessed valuation and sales tax growth, and that its conservative financial planning and limited plans for future debt issuance will keep the relatively high debt levels manageable.
Fitch issued an exposure draft on July 31, 2008 proposing a recalibration of tax-supported and water/sewer revenue bond ratings which, if adopted, may result in an upward revision of this underlying rating (see Fitch research 'Exposure Draft: Reassessment of the Municipal Ratings Framework').
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
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