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Fitch Completes Review of 62 California Redevelopment Agency Tax Allocation Bonds, Revises Ratings

July 23, 2012

Fitch Ratings has completed its comprehensive portfolio review of 62 ratings on tax allocation bond securities (TABs) issued by 36 former California redevelopment agencies. On Jan. 24, Fitch placed the TABs on Rating Watch Negative following the implementation of AB 1x26, which dissolved redevelopment agencies statewide.

 

The following actions were taken:

  • Affirmed and removed from Rating Watch Negative ratings on 22 TABs and subsequently assigned a Stable Outlook;
  • Affirmed and removed from Rating Watch Negative ratings on two TABs and subsequently assigned a Negative Outlook;
  • Downgraded and removed from Rating Watch Negative ratings on seven TABs and subsequently assigned a Stable Outlook;
  • Downgraded and removed from Rating Watch Negative ratings on two TABs and subsequently assigned a Negative Outlook;
  • Removed 13 TABs from Rating Watch Negative without affirmation;
  • Maintained Rating Watch Negative on seven TABs, including two downgrades and five without affirmation;
  • Withdrew the rating on seven TABs issued by one agency due to insufficient information;
  • Assigned Rating Watch Negative on two TABs, including one downgrade and one without affirmation. 

Fitch removed the Rating Watch Negative status from TABs where the successor agencies have been able to overcome issues with cash flow timing, project area revenue separation and housing revenue. Fitch maintained Rating Watch Negative ratings in cases where successor agencies have indicated a lack of funding to pay AB 1484 true-up payments or in cases where the true-up payment amount is in dispute. 

Please visit Fitch’s website for a full press release on its actions.



 
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