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Guam; Miscellaneous Tax May 09
Standard & Poors, May 2009
Standard & Poor's Ratings Services assigned its 'BBB-' rating to the Government of Guam's (GovGuam) $202.425 million limited-obligation (Section 30) bonds, series 2009A. The rating reflects our view of the following credit weaknesses: Concentration in income taxes. Despite the positive impacts expected to result from the pending military buildup in Guam, medium-to-long-term exposure exists with regard to potential future military downsizings or base closures in Guam, given that active military federal income tax withholdings account for approximately 65% pledged revenues (as of 2007); Credit exposure to GovGuam as a speculative-grade ('B+' general obligation rating) entity, given that the bonds' security structure cannot completely isolate GovGuam's bondholders from the territory's financial condition; The possibility that a future U.S. Congress could change...
Companies mentioned in this report are: Guam
Action: New Rating
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Research Type: Full Analysis