DALLAS -- Standard & Poor's Corp. has assigned ratings for two bond refunding issues for a convention and sports center project in St. Louis.
The rating agency gave an A-plus to a $118.82 million refunding of lease revenue bonds backed by state of Missouri appropriations. The rating outlook is negative, Standard & Poor's said.
The agency also assigned a BBB-plus to a $59.93 million refunding of lease revenue bonds backed by St. Louis County appropriations. The rating outlook is stable, Standard & Poor's said.
Sharon Gigante, an associate director with Standard & Poor's, said the difference in the ratings partly reflects the variation in general obligation bond ratings and credit outlooks for the state and county.
Standard & Poor's has an AAA rating with a negative outlook for the state's general obligation bonds because the economy has suffered from defense industry downsizing and other problems.
Standard & Poor's does not rate St. Louis County, but Moody's Investors Service rates it Aal, and Fitch Investors Service Inc. rates it AA-plus.
In addition, the refunding ratings reflect "the ongoing uncertainty surrounding the convention center's ability to produce sufficient economic benefits to the city, county and state to offset the annual appropriation risk that is assumed on this project," Standard & Poor's said in an announcement last week.
The agency said it is uncertain whether the project, America's Center, can complete with similar facilities in the United States, including those in Chicago and New Orleans.
The St. Louis project, which includes a 70,000-seat football stadium, was dealt a blow when the city failed to be selected as an expansion city for the National Football League late last month.
However, positive events include the completion of a light rail system that links America's Center to many downtown attractions and the recent approval or riverboat gaming which should attract more conventioneers to the city, Standard & Poor's said.
