Fitch Rates $85M PennVest (PA) Tax-Exempt CP Rev Notes Ser 2016A 'F1+'

NEW YORK--()--Fitch Ratings has assigned a rating of 'F1+' to the $85,000,000 Pennsylvania Infrastructure Investment Authority PENNVEST/Commonwealth Funded Revolving Fund Tax-Exempt Commercial Paper Revenue Notes series 2016A (notes).

KEY RATING DRIVERS

The rating is based on the support provided by a line of credit (Line) issued by JPMorgan Chase Bank (JPMorgan, rated 'AA-/F1+'/Stable Outlook) which has a stated expiration date of Sept. 27, 2017 unless extended or earlier terminated. The JPMorgan line provides coverage for the principal amount of the notes and interest due on the maturity dates of the notes. Fitch maintains a long-term 'AAA' rating on the PENNVEST/Commonwealth Funded Revolving Fund bonds. The Rating Outlook is Stable, for the long-term rating.

ZB National Association, as the Issuing and Paying Agent (IPA) for the notes is directed to request an advance under the Line whenever proceeds of the sale of rollover notes and the funds of PENNVEST are insufficient to pay maturing notes. The Line provides sufficient coverage for up to $85,000,000 principal amount of notes and 270 days of interest at 12% based upon a 365 day year.

All notes will be issued at par, with interest due at maturity. Following the occurrence of an event of default under the line, JPMorgan may direct the IPA to immediately stop the issuance of any additional notes or may terminate its commitment to purchase notes. In such event, the Line will expire after all the notes supported by such Line mature and have been paid from funds drawn on the line. In addition, the Line may be terminated by JPMorgan upon the occurrence of specified immediate termination events. The dealers for the Notes are Bank of America Merrill Lynch and Morgan Stanley.

RATING SENSITIVITIES

The rating reflects the short-term rating that Fitch maintains on the bank providing liquidity support and will be adjusted upward or downward in conjunction with changes to the short-term rating of the bank and in some cases, the long-term rating of the obligor issuing the CP notes.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Rating Criteria for Variable-Rate Demand Obligations and Commercial Paper Issued with External Liquidity Support (pub. 28 Jan 2016)

https://www.fitchratings.com/site/re/876837

U.S. Municipal Structured Finance Criteria (pub. 23 Feb 2015)

https://www.fitchratings.com/site/re/862222

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1012056

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1012056

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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Contacts

Fitch Ratings
Primary Analyst
Janet Rosen
Analytical Consultant
+1-312-368-3172
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Mario Civico
Senior Director
+1-212-908-0796
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Janet Rosen
Analytical Consultant
+1-312-368-3172
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Richard Park
Director
+1-212-908-0289
or
Committee Chairperson
Mario Civico
Senior Director
+1-212-908-0796
or
Media Relations:
Elizabeth Fogerty, +1-212-908-0526
elizabeth.fogerty@fitchratings.com