KBRA assigns a long-term rating of AAA to the State of Connecticut Special Tax Obligation Refunding Bonds, Transportation Infrastructure Purposes, 2026 Series A and affirms the AAA long-term rating for outstanding Special Tax Obligation Bonds, Transportation Infrastructure Purposes. The rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• Diverse pledged revenue sources provide a stable source of payment and solid coverage of debt service requirements.
• Legal protections are favorable including a covenant to maintain at least 2.0x annual debt service coverage.

Credit Challenges

• The State’s rate of economic growth has been slower than that of the U.S. and New England region for more than a decade although wealth levels are favorable.
• Transportation needs are substantial and place pressure upon the State’s ability to fund them over the longer term.

Rating Sensitivities

For Upgrade

• Not applicable at AAA rating level.

For Downgrade

• An economic downturn that leads to a sustained decline in coverage and budgetary pressure on the State.

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Methodology

• Public Finance: U.S. Special Tax Revenue Bond 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), one of the major credit rating agencies (CRA), is a full-service CRA 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 (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1015039

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