Fitch to Downgrade S-T Rating for Hillsborough Cnty CP Notes Series A, B, C to 'F1'

NEW YORK--()--Fitch Ratings will downgrade the short-term rating to 'F1' from 'F1+' assigned to the Hillsborough County, Florida, Capital Improvement Program, Commercial Paper Notes series A, Series B (AMT), and series C (Taxable) (notes). A maximum of $275,541,016.61 aggregate principal amount of authorized notes may be outstanding at any given time.

The rating action is in connection with (i) the substitution of the current irrevocable direct-pay letter of credit (LOC) provided by State Street Bank & Trust Company (rated 'A+/F1+'; Positive Outlook by Fitch) supporting the notes, with a substitute LOC to be provided by The Bank of Tokyo-Mitsubishi UFJ, Ltd. (rated 'A/F1'; Stable Outlook).

KEY RATING DRIVERS

On the effective date, the rating on the series notes will be downgraded to 'F1' based on the support provided by a substitute LOC to be provided by The Bank of Tokyo-Mitsubishi UFJ, Ltd. The substitute LOC provides coverage in the aggregate for the principal amount of the notes and interest on the maturity dates of the series A and series B notes, and the maturity value of the series C notes which are issued as discount notes.

The short-term rating on the notes will expire on the earlier of April 16, 2018, the expiration date of the substitute LOC, unless such date is extended, or upon any prior termination of the substitute LOC.

U.S. Bank, National Association acting as Issuing and Paying Agent (IPA) will continue as the Issuing and Paying Agent for the notes, and as IPA, is directed to request an advance under the LOC to pay principal and interest on maturing notes. The substitute LOC provides aggregate coverage for all three series of $300 million, calculated as $275,541,016.61 principal plus interest in the amount of $24,458,983.39 calculated as 12% for 270 days based on a 365 day year.

Series A and series B notes will be issued at par, with interest due at maturity. Series C notes are issued at a discount. Following the occurrence of an event of default under the LOC, the bank may direct the IPA to immediately stop the issuance of any additional notes and direct it to draw in full under the LOC for all notes outstanding. In such event, the substitute LOC will expire ten days following receipt of the notice. Alternatively, the bank may send notice that the LOC is being reduced to the maturity amount of notes outstanding. The dealer for the notes continues to be Citigroup.

RATING SENSITIVITIES

The rating is exclusively tied to the short-term rating that Fitch maintains on the substitute bank providing the LOC and will reflect all changes to that rating.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:
--'U.S. Municipal Structured Finance Criteria' (Feb. 24, 2014);
--'Rating Guidelines for Variable-Rate Demand Obligations and Commercial Paper Issued with External Liquidity Support' (Jan. 27, 2014).

Applicable Criteria and Related Research:
U.S. Municipal Structured Finance Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=736618
Rating Guidelines for Variable-Rate Demand Obligations and Commercial Paper Issued with External Liquidity Support
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=730736

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Primary Analyst:
Janet Rosen, +1-312-368-3172
Consulting Analyst
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Secondary Analyst:
Trudy Zibit, +1-212-908-0689
Managing Director
or
Committee Chairperson:
Linda Friedman, +1-212-908-0727
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com

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Contacts

Fitch Ratings
Primary Analyst:
Janet Rosen, +1-312-368-3172
Consulting Analyst
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Secondary Analyst:
Trudy Zibit, +1-212-908-0689
Managing Director
or
Committee Chairperson:
Linda Friedman, +1-212-908-0727
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com