MONTGOMERY—Governor Robert Bentley on Monday announced that Standard & Poor’s Ratings Services has assigned its ‘AAA’ rating for $508.5 million in state highway bonds. The ‘AAA’ rating for the transportation bond is the highest rating the state has ever received, and is the highest rating assigned by the ratings service.
Governor Bentley launched the largest road and bridge improvement program in Alabama’s history in 2012. The Alabama Transportation Rehabilitation Improvement Program (ATRIP) provided cities and counties $1 billion in funding to enhance safety and quality of life for people in communities across the state. In 2012, $327.9 million in funding was provided for ATRIP through the use of GARVEE bonds. The bond rating announced today for $508.5 million represents the additional bond financing for ATRIP projects.
“This S & P rating is a testament to the strong financial stability our transportation program is in Alabama,” Governor Robert Bentley said. “Because of the good credit rating, we will be able to finance the remaining amount of the ATRIP bonds at a very low interest rate and continue to make important upgrades to Alabama roads and bridges.”
The ‘AAA’ rating is a result of the confidence Standard & Poor’s has in Alabama creditworthiness. Alabama will repay the bond with two funding sources, a share of Title 23 federal aid transportation grants, and additional state funds from the gasoline tax proceeds.
Due to the high rating assigned to this series of bonds, Alabama is expected to save approximately $35-$40 million in future interest payments.
A copy of the S&P Rating can be found here.
