KBRA assigns a long-term rating of BBB+ to the Casino Reinvestment Development Authority Luxury Tax Revenue Bonds, Series 2024A and Luxury Tax Revenue Bonds, Series 2024B. KBRA additionally affirms the long-term rating of BBB+ for the Authority's outstanding Luxury Tax Revenue Bonds. The rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• Pledged revenues experienced favorable growth in the years preceding the pandemic and have recovered to levels providing more robust, consistent debt service coverage in each of the last three years.
• Clearly defined pledge of revenues and cash funded debt service reserve fund.

Credit Challenges

• Pledged revenues are limited in scope and sensitive to the success of gaming/entertainment/tourism industry, which is both cyclically sensitive and subject to evolving competitive pressures. Further, pledged revenues are highly seasonal and remain susceptible to event risk.
• Evolving competitive environment with respect to regional casino operators and online gaming/wagering could weigh negatively on pledged revenue performance over time.

Rating Sensitivities

For Upgrade

• While an upgrade is not anticipated, significant growth and diversification in the taxable base over time could precipitate upward rating movement.

For Downgrade

• A secular decline in luxury tax revenues resulting in significantly narrower debt service coverage.
• Additional borrowing resulting in significantly lower debt service coverage.

To access rating and relevant documents, click here.

Methodologies

• Public Finance: U.S. Special Tax Revenue Bond Rating Methodology
• ESG Global Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1005435

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