OREANDA-NEWS. S&P Global Ratings assigned its 'AAA' rating to the Arizona Transportation Board's series 2016 highway revenue refunding bonds, issued for the Arizona Department of Transportation (ADOT). At the same time, S&P Global Ratings affirmed its 'AAA' rating on ADOT's parity senior-lien highway revenue bonds outstanding, and its 'AA+' rating on ADOT's subordinate-lien highway revenue bonds. The outlook is stable.

"The rating reflects our view of ADOT's stable highway user tax revenues and our anticipation that debt service coverage will remain very strong," said S&P Global Ratings credit analyst Nora Wittstruck. "The stable outlook reflects our anticipation that Arizona will make no significant future diversions away from pledged funds in a way that would significantly lower debt service coverage," Ms. Wittstruck added.

We understand series 2016 bond proceeds will refund certain outstanding subordinate lien bonds to reduce interest costs and debt service requirements.

Pledged revenue consists of certain allocations of fuel taxes; vehicle registration fees; motor vehicle license in-lieu-of tax; and commercial motor carrier, license, and other fees levied by the state, all of which are initially deposited in the Arizona Highway User Revenue Fund (HURF), after certain prior annual diversions by the state.