Fitch Ratings has affirmed the underlying rating on the Massachusetts Port Authority's (MassPort) approximately $83.8 million special facilities revenue bonds (BosFuel Project), series 2007 at 'A-'. The Rating Outlook is Stable.
The 'A-' rating reflects BosFuel's exclusive role in providing an essential storage and distribution fueling service to airlines at strong Boston Logan (BOS, the airport) airport, which largely mitigates against demand elasticity as costs rise. The rating further reflects BosFuel's strong Interline Agreement, which hedges against carrier delinquencies and defaults and provides the consortium with unlimited rate-making flexibility to fully recoup operating expenses and debt service costs. The rating is constrained by the financial structure of the bonds, specifically with regard to the credit's narrow revenue pledge, high leverage levels of roughly 11x and cash-flow sufficient coverage levels.
