Moody’s Investors Service has assigned Aa2 ratings to the Port of Vancouver, WA’s Limited Tax General Obligation Bonds, 2022A (AMT) and Limited Tax General Obligation Bonds, 2022B (Non-AMT). The expected par amounts are $15.8 million and $8.7 million, respectively. Moody’s maintains the port’s Aa2 issuer rating and the Aa2 rating on the outstanding general obligation limited tax (GOLT) debt. The issuer rating is the equivalent of a hypothetical unlimited tax general obligation (GOULT) rating; there is no debt associated with the GOULT security. Inclusive of the current issuance, the port will have about $49.9 million of GOLT debt outstanding.

RATINGS RATIONALE

The Aa2 issuer rating reflects the port’s large, growing and diverse tax base that benefits from its integration to the Portland-Vancouver metro area. The rating also incorporates the port’s healthy liquidity and sound financial metrics that remained strong through the pandemic. The rating is constrained by the port’s moderately high debt burden, though this is mitigated by sound coverage of GOLT bond debt service from the property tax levy. The port has a manageable capital program, and its pension liabilities are modest.

The absence of a rating distinction between the port’s Aa2 issuer rating and its Aa2 limited tax general obligation rating reflects the strength and broadness of the full faith and credit pledge in Washington.

RATING OUTLOOK

Moody’s does not typically assign outlooks to local governments with this amount of debt.

FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS

– Material tax base growth and improvement in resident income

– Substantial growth of operations and liquidity
– Reduction in long-term liabilities

FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS

– Substantial tax base contraction and decline in resident income

– Material reduction in demand for port services leading to weakened financial profile
– Significant growth in long-term liabilities

LEGAL SECURITY

The GOLT bonds are secured by the full faith and credit of the port district within the constitutional and statutory limitations of non-voter approved debt.

USE OF PROCEEDS

Bond proceeds will finance the construction, improvement and equipping of port facilities, property and related demolition, including berth rehabilitation and modernization, bank stabilization and trail construction.

PROFILE

The Port of Vancouver is located on the north shore of the Columbia River and includes the City of Vancouver (Aa2), a portion of the City of Camas (Aa2) and a quarter of Clark County, WA (Aa1). The port is the third largest in the state and operates five marine terminals with depth of 43 feet. In addition, the port offers more than 2.7 million square feet of warehouse space, including over 600,000 of waterfront space for industrial, manufacturing and distribution operations.
Source: Moody’s