KBRA assigns a long-term rating of A+, with a Stable Outlook to Airport Revenue Bonds, Series 2024A (AMT) and Series 2024B (Non-AMT) to be issued by the Reno-Tahoe Airport Authority, NV ("the Authority"). The Authority owns, operates and manages the Reno-Tahoe International Airport (RNO or "the Airport") and a small general aviation airport, both of which comprise the Airport System. Airport Revenue Bonds are payable solely from and secured by a pledge of Net Revenues of the Airport System, along with certain funds and accounts, and other amounts payable under the Master Indenture.

Key Credit Considerations

Credit Positives

• Enplanement growth prior to and in the wake of the pandemic, buttressed by a healthy air trade area and limited competition.
• Sound financial performance, characterized by increasing non-airline revenue generation and healthy liquidity.
• Historically limited use of debt as a source of capital funding.

Credit Challenges

• Expected, significant increase in leverage as borrowing to fund MoreRNO occurs over multiple fiscal years.
• Execution and completion risks associated with implementing a multi-year, transformational CIP.
• RNO’s still small enplanement base, coupled with moderate airline concentration and limited geographic reach.

The Stable Outlook reflects KBRA’s expectation that Authority’s financial performance and liquidity levels will remain at or near current levels, with MoreRNO projects prudently implemented on-time and on-budget. DSC projections are, in KBRA’s view, attainable, with continued growth in non-airline revenues helping to temper expected increase in airline costs.

Rating Sensitivities

For Upgrade

• Strengthening operating margins, coupled with debt service coverage that consistently exceeds required minimums.
• Maintenance of competitive airline costs in-line with projections.

For Downgrade

• Issuance of additional debt without a commensurate rise in resources available for repayment.
• Failure to implement the MoreRNO Program on-time and within budget, resulting in financial stress.
• While not expected, a prolonged period of depressed passenger traffic resulting from an exogenous shock or structural shift in the airline industry.

To access rating and relevant documents, click here.

Methodologies

• Public Finance: U.S. General Airport Revenue Bond Rating Methodology
• ESG Global Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1005424

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