In a move that you'll save almost eight cents on every dollar debtor, Miami-Dade commissioners have authorized the issuance of up to $400 million in aviation revenue reimbursement bonds to pay off the bonds sold for finance improvements former capitals at county airports.
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This includes Initial $351 million to repay and redeem all or part of the outstanding series of bonds, as well as the costs of premiums and debt service, for:
■ $18.9 million in bonds from non-alternative minimum taxes (AMT) of the Series 2019C for Series 2009A Aviation Revenue Bonds.
■ $10.5 million in Non-AMT Bonds Series 2019D for the 2009B Aviation Revenue Bond Series.
■ $321.7 million in Series 2019 taxable bonds for the 2012A and 2012B Aviation Revenue Bond Series – AMT and non-AMT bonds, respectively.
The issuance of bonds and subscription fees will cost about $3.26 million, According to a July 23 memorandum Deputy Mayor Ed Marquez, who pointed out that the rebates savings – structured as fixed rate current interest bonds – exceed the county's 5% savings threshold that must be exceeded in order to repay the bonds.
“Based on market conditions as of June 17, 2019, the proposed refund generates adebt service savings of approximately $28.2 million during the term of the 2019 Series Reimbursement Bonds, which represents a new present value savings of $23.8 million or 7.6% of the amount of the reimbursed bonds,” the memorandum says.
Good grade
August 8, Fitch Ratings gave all three series of 2019 revenue reimbursement bonds an "A" rating and a "positive" outlook, citing the airlines' "new long-term use agreement of Miami International Airport, which demonstrates the commitment of the signatory airline to serve the strong air service area and should allow the plan's established track record of growth and stable financial results to continue."
The rating also reflects "the airport's current more moderate and flexible capital program over the medium term," Fitch analysts Jeffrey Lack and Seth Lehman wrote, adding that the clarity of the airport's new long-term master plan Miami International Airport and the leverage profile in the case of Fitch ratings "could justify a higher rating."
Fitch rated Miami International Airport as "stronger» in four areas of revenue risk - volume, price, debt structure, and infrastructure development and renovation - and listed preserving the airport's traffic base and diversifying the carrier mix as developments that could lead to further positive rating actions.
Conversely, potential events that could lead to a downgrade include increased capital expenditures and borrowing, material losses, and increased volatility in aviation activity.
“Miami is currently located in the top two US airport positions in terms of non-stop international destinations and international air cargo tonnage," the report says. "Still, Fitch sees future traffic stability as a ongoing risk given the high traffic concentration of American Airlines operations, and the exposure From the airport to the Latin American economies.
Currently, American Airlines serves at least two-thirds of the passengers from the airport, Aviation Director Lester Sola told Miami Today.
Previous improvement plan of capital of the Department of Aviation of 6.500 million, which began in 1993 and for which all the $6.200 billion in aviation bonds cleared, is now "substantially complete," wrote Mr. Lehman and Mr. Lack.
Investments planned in the MIA
Miami International Airport has approximately $5.300 billion in debt of seniors, which translates to about $240 per project, they wrote.
The Aviation Department is preparing for a new $5.000 billion capital improvement plan, which county legislators approved in May and consists of cinco "subprograms" focused on Miami International Airport's North, Central and South terminals, cargo facilities and various other improvements, including up to two new hotels in the main hub and improvements to the county's four general aviation airports.
Until 2025, according to the report, the county will spend about 1.500 billion dollars in the new plan.
Fitch called the new plan "forward-looking," with “more manageable” risks than before, in part due to the structure that allows projects to start and stop as needed.
"Here, everything is in phases," said Mr. Sola. "You're not in a hurry to do it all, and there may be projects that we initially planned but airlines can say, 'You know what, we don't need that anymore,' so you'll pull that project out and you can trade it for another one, which isn't what Same thing that has happened in the past."