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Rail News: Passenger Rail

Credit where it's due: Moody's boosts L.A. MTA bond ratings

Moody's Investor Service recently upgraded its rating on Los Angeles County Metropolitan Transportation Authority's (MTA) Proposition A First Tier Senior Sales Tax Revenue Refunding Bonds to Aa3, up from A1. Moody's also upgraded its rating for MTA's First Tier Second Senior bonds secured by Proposition A sales tax revenues to A1, up from A2.

The upgrades reflect credit strengths including a "large, diverse sales tax base [that] has shown resiliency in the current economic slowdown," Moody's said in a prepared statement. The service also cited MTA's new management team and organizational structure, which "focused on service delivery, asset maintenance and compliance with [the] Consent Decree," a federal court settlement MTA signed in 1996 that called for a series of Metro Bus improvements to reduce overcrowding.

MTA expects the rating upgrades, which affect all of the authority's outstanding Proposition A First Tier bonds, as well as the planned "Series 2003-A" bonds to be issued in early 2003, to lead to lower interest costs on future Proposition A bond issues.

Contact Progressive Railroading editorial staff.

More News from 12/23/2002