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Tuesday, March 21, 2000

Bonds for state harbors
get A+ rating

By Peter Wagner


Some $80 million in revenue bonds to be sold later this month by the Harbors Division of the state Department of Transportation have been rated "A+" by a nationwide credit-rating firm.

The above-average rating reflects a sound harbor system and potential growth in the state's nine-port system, according to Fitch IBCA, a nationwide credit rating company.

Fitch spokesman Roger Johnson said today that the state will use the money to pay off debts and for improvements at Barbers Point and Kahului harbors. About $55 million will go toward paying off the division's existing $135 million debt while $25 million will go to harbor improvements, he said.

State officials could not be reached for comment this morning.

The bonds, secured by Harbors Division revenues, are to be sold on March 28 via a syndicate led by PaineWebber Inc.

The A+ rating is slightly above average, with AAA at the top of the scale. "The lack of competition from other ports and modes of transportation are strengths of the credit," Fitch said in a press release. The rating also notes an emerging cruise ship industry, Johnson said.

Other considerations include the division's strong financial position with adequate cash to pay for on-going projects and a relatively-low fee structure, allowing for future increases, Johnson said.

While Hawaii's 10-year economic slump offsets some of the positives, New York-based Fitch does not view the Asian economic crisis as a lasting problem.

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