Beverly Shores, IN Bond Rating Lowered To ‘A+’ From ‘AA-‘ On The Application Of New Criteria; Taken Off UCO
HARTFORD (S&P Global Ratings) Dec. 2, 2024--S&P Global Ratings lowered its rating to 'A+' from 'AA-' on Beverly Shores Redevelopment Authority (RDA), Ind.'s series 2020 lease rental revenue bonds, issued for Beverly Shores Town, and removed the rating from Under Credit Observation. The outlook is stable.
"The downgrade reflects the application of our methodology for rating U.S. governments, published Sept. 9, 2024," said S&P Global Ratings credit analyst Alex Tomczuk.
The series 2020 lease rental revenue bonds are secured by lease rental payments paid by the town directly to an independent trustee pursuant to a trust indenture between the RDA and trustee, as well as a lease between the RDA and the Beverly Shores Redevelopment Commission.
Rental payments are payable from a special benefits tax (ad valorem property tax) on all taxable property within the Beverly Shores Redevelopment District, which is coterminous with the town. Rental payments are not subject to annual appropriation with lease terms we view as standard under our criteria.
The ad valorem property tax is subject to state circuit-breaker legislation, capping the property tax burden for taxpayers based on a percentage of the real estate parcels' gross assessed value. However, Beverly Shores' circuit breakers are minimal and we rate the series 2020 bonds on par with our view of the town's general creditworthiness due to the fungibility of resources available for debt service. The rating reflects our view of Beverly Shores' solid economic metrics as a relatively wealthy lakeshore beach town.
The stable two-year outlook reflects S&P Global Ratings' expectation for limited economic change for the town and stable-to-improving available cash-based reserves. We could take a negative rating action if Beverly Shores' current costs, capital needs, or other factors were to create operating pressure that caused available reserves to decrease to levels that do not offset debt profile weakness and our view of the town's limited risk-mitigating policies and practices. We could take a positive rating action if the town were to maintain available cash-based reserves at significantly higher levels.
Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.spglobal.com/ratings for further information. Complete ratings information is available to RatingsDirect subscribers at www.capitaliq.com. All ratings affected by this rating action can be found on S&P Global Ratings' public website at www.spglobal.com/ratings.
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| Primary Credit Analyst: | Alex Tomczuk, Hartford 1-617-530-8314; alex.tomczuk@spglobal.com |
| Secondary Contact: | Moreen T Skyers-Gibbs, New York + 1 (212) 438 1734; moreen.skyers-gibbs@spglobal.com |
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