Featured Bond – Week of August 26, 2019: City of Atlanta to Issue $686 Million in General Revenue Airport Bonds
The featured bond for the week of August 26, 2019 is the City of Atlanta’s Hartsfield-Jackson International Airport.
Atlanta’s Hartsfield-Jackson International Airport has remained the world’s busiest airport based on passenger enplanements for nearly two decades. To maintain its facilities, service its debt, and keep its over 100 million passengers flying high, the City of Atlanta is scheduled to issue a $686 million negotiated bond in four series.
- Series 2019A is a Non-AMT $94.4 million lien on Airport Pledged Revenues with an amortization schedule of July 1st 2021-49.
- Series 2019B is an AMT $194.58 million lien on Airport Pledged Revenues with an amortization schedule of July 1st 2021-49
- Series 2019C is a Non-AMT $182.79 million hybrid bond securitized by liens on Passenger Facility Charge (PFC) revenues and with an amortization schedule of July 1st 2035-2049.
- Series 2019D is an AMT $214.72 million hybrid bond securitized by liens on Passenger Facility Charge (PFC) revenues and with an amortization schedule of July 1st 2034-2049.
The purpose of this bond is to fund the ATL Next project that aims to modernize the Airport in anticipation of projected growth, as well as to finance current debt obligations. The variety and scale of new construction projects will result in a comprehensive revitalization and expansion of the Atlanta airport as its traffic continues to accelerate over the next few decades. The project includes runway improvements, terminal and concourse renovations and expansion and fire/safety improvements, among others. In addition, the bond proceeds will fund a debt service reserve fund, pay capitalized interest during construction and costs of issuance.
The Bonds are being issued as General Revenue Bonds under the Master Bond Ordinance and are payable from and secured on a parity (equal) basis with the outstanding Senior Lien General Revenue Bonds by a senior lien on a pledge of revenues. General Revenues exclude funds in the Revenue Fund used to pay operating expenses.
Series A and B are securitized by all General Revenues of the airport, except for PFC Revenues, Special Purpose Revenues, and Released Revenues. The hybrid bonds, Series C and D, are securitized by PFC revenues and other contracts related to the bond.
Current projections for the growth of Hartsfield-Jackson’s passenger traffic and expanded capacity contribute to the Airport’s credit quality. The bonds have been awarded AA- ratings from S&P and Fitch and an Aa3 rating from Moody’s.
In the opinion of bond counsel, the Series A and C bonds are tax-exempt and are not subject to the Alternate Minimum Tax (AMT). The Series B and D bonds are tax-exempt, subject to the AMT, except when held by a “substantial user” of the Airport facilities or a “related person” within the meaning of Section 147(a) of the Internal Revenue Code.
These details and more on purposes, security, risks and other matters pertaining to these City of Atlanta Hartsfield-Jackson International Airport Bonds can be found in the preliminary official statement, provided by MuniOS. You will need to create an account at MuniOS to access this content.
Statistical Snapshot of Hartsfield-Jackson Atlanta International Airport —
FY Ended June 30, 2018
Hartsfield-Jackson Compared to Sector Medians for Large Hub Airports
These facts and numbers are for informational purposes, and should not be considered an official disclosure for potential investors. Investors should consult the official statement. None of the information provided should be construed as a recommendation by MuniNet Guide, MuniNet LLC, Merritt Research Services LLC, or any of their employees. Information and analysis is for informational purposes only.
Potential investors should rely only on the official documents and figures provided in the official statement (prospectus). Although the numbers presented in this summary are primarily derived from public documents, including issuer audits, issuer reports and other public sources such as federal reporting agencies , they are not intended to replace official information presented in connection with the bond sale. Medians may differ from official sales documents due to methodology or survey base variances.