budget for aviation and dulles corridor enterprise funds

2012 BUDGETMetropolitan Washington Airports AuthorityAirport System Revenue BondsLiensSubordinate BondsIn 1988, to provide for the initial stages of the CCP, and other capital financing needs whilenegotiations with the Airlines on the Airline Agreement were underway, five series ofsubordinated bonds backed by major financial institutions were issued for $263.4 million.These subordinate bonds have either been refunded or the debt retired. Since October 1998,no subordinate bonds have been outstanding.Senior BondsA Senior Master Indenture of Trust (Master Indenture) was created in 1990 for the AirportsAuthority. A Supplemental Indenture is required before a series of Bonds is issued under theMaster Indenture. The Master Indenture was amended effective September 1, 2001, to inpart, change the definition of Annual Debt Service to accommodate the issuance of securedcommercial paper to permit the Airports Authority to release certain revenues from thedefinition of revenues, and to expand the list of permitted investments to include innovativeinvestment vehicles designed to increase the return on the Airports Authority investments. Atotal of $9.6 billion of bonds has been issued by the Airports Authority since March 1988.The proceeds of the Bond issues are used to finance capital improvements at both Airportsand refund outstanding Bonds when savings meet the Airports Authority’s refunding criteria.The Airports Authority anticipates the issuance of bonds over the next year to fund projects inthe CCP and refund outstanding debt when advantageous.RatingsThe uninsured fixed rate bonds are rated long-term “Aa3” by Moody’s, “AA-” by S&P, and“AA-” by Fitch Ratings. In September 2011, Fitch Ratings revised the Airports Authority’s“AA” rating to “AA-“ and changed the outlook from “Negative” to “Stable,” Moody’s affirmedthe “Aa3” rating and the outlook of “Negative,” and S&P affirmed the “AA-” rating with “StableOutlook”.S&P has assigned the Airports Authority an overall Debt Derivative Profile of “1” on a scale of“1” to “4”, with “1” representing the lowest risk and “4” representing the highest risk.274