KBRA assigns a long-term rating of AA to the Washington Metropolitan Area Transit Authority Second Lien Dedicated Revenue Bonds, Series 2023A (Sustainability Bonds – Climate Bond Certified). KBRA additionally affirms the longterm rating of AA+ for the Authority's senior lien Dedicated Revenue Bonds outstanding. The rating Outlook is Stable.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• The signatory jurisdictions have an uninterrupted 47-year history of payment of their annual commitments.
• Strong credit characteristics of signatory jurisdictions supports appropriation funding mechanism.
• Essentiality of mass transit to metropolitan Washington D.C. area and established history of operating and capital support by these jurisdictions.
• Substantial coverage of debt service requirements.

Credit Challenges

• Dedicated revenue sources may be adversely affected by economic cycles and exogenous events.
• Signatories are allowed to proportionally reduce their dedicated capital funding contribution if another does not pay the full amount of their obligations.

Rating Sensitivities

For Upgrade

• Improved credit position of signatory jurisdictions.

For Downgrade

• Weakened credit position of one or more of the signatories.
• Failure of one or more signatories to make its committed appropriation in full.

To access rating and relevant documents, click here.

Methodologies

Public Finance: U.S. State Annual Appropriation Obligation Rating Methodology

ESG Global 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) is a full-service credit rating agency 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 by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

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