ATLANTA- A pledge by Hillsborough County, Fla., to back three upcoming reverse bond issues could pull down the ratings of its outstanding debt, according to the county's financial adviser.

The adviser, William R. Hough & Co., warned in a recent report that the pledge to backstop approximately $160 million of pending issuance to help finance cruise terminals, sports facilities, and other projects "will most likely cause the rating agencies to reevaluate" the county's credit rating.

"It is our opinion that the rating agencies will view funding these nonessential projects as a fundamental shift in fiscal policy, triggering a review and a possible downgrade of the county's general obligation and non-ad valorem revenue bond debt ratings," Hough said. The report also expressed concern that the projects "are not self-supporting."

The county's $12 million of general obligation debt is rated Aa by Moody's Investors Service and AA-minus by Standard & Poor's Corp. Its $71 million of non-ad valorem revenue bonds are rated A by Moody's and Standard & Poor's.

Last week, after more than a year of discussion, the county's board of commissioners approved backing three bond issues that provide funding for five projects, none of which is fully supported by self-generated revenues.

The largest bond issue under consideration is an $80 million revenue offering proposed by the Tampa Port Authority. The authority hopes to sell the issue by mid-1995 to fund new cruise terminals and other improvements.

Under the backup pledge, the county will cover debt service from legally available non-ad valorem revenues if the port revenues prove insufficient, according to county debt manager Michael Merrill.

The unanimous approval to cover the Port Authority bonds came last Thursday, a day after commissioners authorized two other bond issues, funding a total of four projects.

On Wednesday, the commissioners pledged $3.5 million in annual debt service to cover a bond issue that will help finance a $100 million sports arena for the Tampa Bay Lighting, a professional hockey team. The Tampa Sports Authority hopes to issue approximately $40 million of countybacked bonds sometime in January, according to Merrill.

The county hopes to cover much of the $3.5 million commitment with $2 million of expected annual collections from an upcoming 1 cent increase in the hotel occupancy tax. The increase, to 5 cents per dollar, will take effect in February.

The hotel tax generated $1.74 million per penny during the 1994 fiscal year, which ended Sept. 30, Merrill said.

Hillsborough County hopes to cover the remaining $1.5 million of its yearly pledge from a ticket surcharge levied on events at the arena.

According to recent estimates, $2 million of hotel tax revenues would allow issuance of $25 million of tax-exempt bonds, Merrill said. The $1.5 million from the ticket surcharge would permit issuance of $15.2 million of taxable debt.

Also on Wednesday, the county commission approved a total of about $38 million in debt for three projects, including a spring training facility for the New York Yankees baseball team.

According to Merrill, $21 million of the borrowing would help cover funding for the baseball stadium, about $15 million would finance a radio communications system, and about $2 million would cover land acquisition. The sale is planned for next Wednesday.

The bonds will be secured by the county's portion of Florida's half-cent local government sales tax. The tax is collected by the state and distributed to localities based on population in incorporated and unincorporated areas.

Analysts at Moody's and Standard & Poor's yesterday expressed concern about the county's upcoming borrowings.

Moody's vice president John Incorvaia said the rating agency is worried that the county could become burdened by its pledge to cover debt service on both the port and hockey stadium bond issues.

"We don't have immediate concerns about the viability of the county's double-A [GO] rating, but in the longer term, the pledge could become a problem," Incorvaia said. "We'll pay very close attention to the revenues coming in from the projects, particularly at the port, and how the county makes up any shortfalls."

Hillsborough is one of only five Florida counties whose GOs are rated Aa by Moody's.

At Standard & Poor's, Steve Nelli, a director, had a similar assessment. "To the extent that there is a siphoning off of money from the county's general operating funds for non-essential projects, we see the possibility of a lot of fiscal stress for the county," he said. "We're still comfortable with the AAminus, but I can't say there won't be some reevaluation down the line."

Last week Moody's awarded an A1 rating to the upcoming $38 million sales-tax revenue bond issue. Standard & Poor's has rated the deal A-minus, and Fitch A-plus.

Merrill said the county is working to provide reassurance to the rating agencies and safeguards for potential investors.

For the port and hockey arena bond issues, he said, interest will be capitalized to cover payments during the construction period. In addition, Merrill said, the port authority will set up a special capital reserve to augment the traditional debt service reserve fund. Officials at the Port Authority say they need additional facilities because of an increase in trade with Mexico, prompted by passage this year of the North American Free Trade Agreement and the growth of the port's cruise-ship business.

The port authority will use proceeds to fund about $35 million in new projects, including wharf improvements and as many as three new cruise-ship berths, according to Merrill. The remainder of the proceeds will be used to refund and restructure the authority's existing obligations. The authority's outstanding debt is rated triple-B.

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