Post by Logan on Jul 8, 2016 5:38:59 GMT -6
HELENA — Montana kept its AA credit rating on coal severance tax bonds, according to a release from the bond-rating agency S&P Global Ratings on Thursday.
The bond rating matters, said Dan Villa, the governor's budget director, because it can affect the rate cities, towns and counties pay on bonds they use to fund water and sewer projects.
There are loans out now on about 70 projects across the state for a total of $115 million.
Coal severance tax bonds rely on money from a tax paid on coal production in the state as collateral. The ratings agency cited Montana's high debt service coverage, a pledge of half of the coal severance tax revenues deposited into a trust fund, a drop in debt service and extra bond tests as reasons for the rating. Things that hurt the rating include sensitivity in coal prices and regulatory issues that could reduce the demand for coal, like a law passed in Oregon earlier this year that calls for utilities in the state to get less electricity from coal-fired power plants.
Read more: billingsgazette.com/news/state-and-regional/montana/montana-keeps-rating-on-coal-tax-bonds/article_a72ac872-d05e-5a92-a7ee-ac5872ef187f.html
The bond rating matters, said Dan Villa, the governor's budget director, because it can affect the rate cities, towns and counties pay on bonds they use to fund water and sewer projects.
There are loans out now on about 70 projects across the state for a total of $115 million.
Coal severance tax bonds rely on money from a tax paid on coal production in the state as collateral. The ratings agency cited Montana's high debt service coverage, a pledge of half of the coal severance tax revenues deposited into a trust fund, a drop in debt service and extra bond tests as reasons for the rating. Things that hurt the rating include sensitivity in coal prices and regulatory issues that could reduce the demand for coal, like a law passed in Oregon earlier this year that calls for utilities in the state to get less electricity from coal-fired power plants.
Read more: billingsgazette.com/news/state-and-regional/montana/montana-keeps-rating-on-coal-tax-bonds/article_a72ac872-d05e-5a92-a7ee-ac5872ef187f.html