Moody's Investors Service assigned a MIG-1 rating to an upcoming Western Tidewater Regional Jail Authority issue, the first rating the firm has given to debt issued by a Virginia jail authority.
The MIG-1, Moody's highest rating for short-term debt, was given last week. The $10 million revenue note issue is slated to be sold through negotiation this Thursday.
Moody's said it based its rating on the "favorable credit quality" of the cities of Suffolk and Franklin, and of the Isle of Wight County. The three jurisdictions made an unconditional general obligation pledge to make several, pro rata debt service payments for the notes.
The Virginia General Assembly passed legislation in 1990 allowing the creation of jail authorities. The law requires them to be composed of at least three localities, which may receive state reimbursements for up to 50% of the construction costs for jails and significant subsidies for operations.