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Outlook On New York State ThruwayAuthority Revised To Negative On PossibleLower Debt Service Coverage
Primary Credit Analyst:
Joseph J Pezzimenti, New York (1) 212-438-2038; joseph_pezzimenti@standardandpoors.com
Secondary Contact:
Peter V Murphy, New York (1) 212-438-2065; peter_murphy@standardandpoors.com
NEW YORK (Standard & Poor's) June 12, 2012--Standard & Poor's Ratings Serviceshas revised its outlook on New York State Thruway Authority's (NYSTA) generalrevenue bonds outstanding to negative from stable. At the same time, Standard& Poor's assigned its 'A+' long-term rating to NYSTA's general revenue bonds,series I. Standard & Poor's also affirmed its 'A+' long-term rating on theauthority's general revenue bonds outstanding. In addition, Standard & Poor'saffirmed its 'SP-1+' short-term rating on NYSTA's general revenue bondanticipation notes (BANs), series 2011A, maturing in July 2012.The outlook revision reflects what we believe is the potential for lower debtservice coverage (DSC) if the authority does not obtain formal board approvalin September this year to increase commercial vehicle tolls 45%. "Uncertaintyrelated to NYSTA's plan of finance and long-term tolling strategy related tothe replacement of the Tappan Zee Bridge and ongoing capital needs alsocontributed to the outlook revision," said Standard & Poor's credit analystJoseph Pezzimenti.The 'A+' rating reflects our view of the following positive credit factors:• The essentiality of the 570-mile thruway system, the largest in the U.S.,serving 37 of New York's 62 counties and a majority of the state'spopulation;• Limited competition from toll-free alternatives;• Competitive tolls relative to those of other regional authorities,providing ample rate-setting flexibility; and• Historically strong DSC, which has been no lower than 1.75x from fiscals
June 12, 2012
www.standardandpoors.com/ratingsdirect
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975376 | 301740986
 
2009-2011.NYSTA is issuing the series I bonds to redeem the series 2011A BANs andprovide additional capital funding.The authority, the largest toll system in the U.S., is a 570-mile superhighwaysystem crossing the state. The thruway's route from the New York City line tothe Pennsylvania line is 496 miles long and includes a 426-mile mainlineconnecting the state's two largest cities, New York City and Buffalo.The negative outlook reflects our concern that the timing and magnitude ofrevenue enhancement and operational streamlining initiatives might not beenough to offset NYSTA's significant additional debt needs, making itdifficult to maintain financial margins consistent with the ratings. If theauthority is able to implement an aggressive tolling regime that we believewill allow it to maintain DSC and liquidity near current levels, while alsotaking into account the funding of the Tappan Zee project and ongoing capitalneeds, we could revise the outlook to stable within our two-year outlookperiod. We will likely lower the rating if the plan of finance for the TappanZee project and ongoing capital needs produce a financial risk profileconsistent with a lower rating.RELATED CRITERIA AND RESEARCH• USPF Criteria: Toll Road And Bridge Revenue Bonds, June 13, 2007• USPF Criteria: Bond Anticipation Note Rating Methodology, Aug. 31, 2011Complete ratings information is available to subscribers of RatingsDirect onthe Global Credit Portal at www.globalcreditportal.com. All ratings affectedby this rating action can be found on Standard & Poor's public Web site atwww.standardandpoors.com. Use the Ratings search box located in the leftcolumn.
Standard & Poors
| RatingsDirect on the Global Credit Portal |
June 12, 2012
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975376 | 301740986
Outlook On New York State Thruway Authority Revised To Negative On Possible Lower Debt Service Coverage
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