Standard & Poor’s, a major credit-rating service, revised its long-term bond outlook for about $22.4 million in revenue bonds for Fresno Yosemite International Airport from “stable” to “positive” and affirmed the rating of the bonds at BBB, the lower boundary of investment-grade credit.
The revision of the outlook reflects the rating service’s assessment of the potential direction of a long-term credit rating over the next six months to two years. A positive outlook means that the rating may be raised at some point in the future. In a brief release, S&P reported that the revision is the result of “an improving liquidity position” for the airport’s operations.
Fresno City Manager Bruce Rudd said the outlook revision “is a direct result of the direction made two years ago that all of the city’s enterprise departments, which includes airports … establish minimum operating reserves of 25 percent within their individual budgets.”
A “BBB” credit rating indicates that the bond issue currently provides adequate protection for investors, but S&P notes that adverse economic conditions or changing circumstances could weaken the city’s ability to meet its financial obligations to bondholders.