OREANDA-NEWS. Fitch Ratings has assigned an 'AA-' rating to the following Mansfield, Texas (the city) bonds:

--$7.2 million Mansfield Park Facilities Corporation (MPFDC) sales tax revenue refunding and improvement bonds, series 2016;
--$15 million MPFDC sales tax revenue refunding and improvement bonds, taxable series 2016.

The bonds are scheduled for a negotiated sale no later than the week of Dec. 14. Proceeds will refund outstanding MPFDC sales tax bonds for interest savings and will be used for park improvements and to acquire reserve fund surety bonds.

In addition, Fitch takes the following rating actions:

--$9.8 million MPFDC outstanding sales tax bonds upgraded to 'AA+' from 'AA-';
--$2.7 million Mansfield Economic Development Corporation (MEDC) sales tax revenue bonds, series 2012 affirmed at 'AA+';
--$7.6 million MEDC sales tax revenue refunding bonds series 2015 and revenue refunding bonds taxable series 2015 affirmed at 'AA-'.

Fitch has withdrawn the 'AA+' rating on MEDC's sales tax revenue refunding bonds (taxable) series 2012 as the bonds were not sold.

The Rating Outlook is Stable.

SECURITY

The MPFDC bonds are payable from a lien on and pledge of a 0.5% sales and use tax levied within the city for the benefit of the MPFDC. The outstanding MPFDC bonds have a first lien on the revenues, and the new series 2016 and taxable new series 2016 bonds have a subordinate lien.

The MEDC bonds are payable from a lien on and pledge of a separate 0.5% sales and use tax levied within the city for the benefit of MEDC. MEDC series 2012 bonds have a first lien on the revenues, and the new series and taxable new series 2015 bonds have a subordinate lien.

KEY RATING DRIVERS

HEALTHY DEBT SERVICE COVERAGE: Sales tax revenues have realized healthy growth and generated solid coverage levels for all MDEC and MPFDC bonds subsequent to a short recessionary lull.

UPGRADE OF SENIOR MPFDCs: Upgrade of the outstanding MPFDC bonds reflects the planned closure of this senior lien and strong 3.91x coverage that will apply to the remaining MPFDC bonds subsequent to the refunding. Fitch anticipates coverage of the senior MPFDC bonds to remain strong given the closed lien and a favorable economic outlook.

MODEST CAPITAL NEEDS: Fitch anticipates modest additional debt for these two corporations based on the current long-term capital plan. Funding is primarily from the residual sales tax revenues.

ABOVE-AVERAGE DEMOGRAPHICS: Income and educational assessment levels trend well above average. Participation in the strong regional economy and the city's expanding job base contribute to a low unemployment rate.

GROWTH PROSPECTS: Mansfield's proximity to the Dallas-Fort Worth metroplex, coupled with its ongoing transportation infrastructure development, position the city for continuing residential and commercial/industrial expansion.

SALES TAX RATINGS CAPPED: The MPFDC and MEDC sales tax bond ratings are limited by the city's general credit quality to reflect the potential for a disruption in pledged revenue in the unlikely event of a bankruptcy filing by the city. For information on the city's general credit quality, refer to 'Fitch Rates Mansfield, Texas' GOs and Cos 'AA+' Outlook Stable' (Dec. 1, 2015).

RATING SENSITIVITIES

SOUND COVERAGE: The ratings are based on the continuation of sound coverage, consistent with pledged revenue trends and limited new issuance plans.

CREDIT PROFILE
Mansfield is located within the ninth largest metropolitan area in the nation, with 1.1 million residents located within a 15-mile radius. The city's estimated population of 69,448 has more than doubled since the 2000 census. A significant amount of developable land remains within Mansfield's 38.6 square mile boundary.

NONPROFIT CORPORATIONS PROMOTE LOCAL ECONOMIC DEVELOPMENT
The MPFDC is a 4B nonprofit corporation created in 1992 following the passage of a 1/2 of 1% sales tax; the MEDC is a 4A corporation that was formed in 1997 with the passage of a separate 1/2 of 1% sales tax. The MPFDC has focused on various parks and recreation projects since its creation, while the MEDC has helped attract business to the city through location assistance and infrastructure improvements. In addition to sales tax revenues, both corporations receive gas royalty monies that are applied to their respective mission objectives.

HEALTHY SALES TAX RECEIPTS AND COVERAGE
The city's sales tax performed relatively well during the recession, flattening out during fiscal years 2009 and 2010 before resuming growth. Receipts rebounded strongly, realizing 7.5% compound annual growth during fiscal years 2011 through 2015.

Receipts for fiscal 2015 totaled $4.8 million for each corporation. MPFDC maximum annual debt service (MADS) of $2.25 million including the new debt is covered a sound 2.15x by fiscal 2015 receipts; MEDC MADs of $1.2 million is covered 4.02x. Coverage responds well to stress tests, approximating 1.8x and 3.4x for MPFDC and MEDC respectively based on a severe 15% decline below fiscal 2015 revenues.

ADEQUATE LEGAL PROVISIONS
The additional bonds test is somewhat liberal at 1.35x MADs. The city anticipates a potential for MEDC issuance in the 10-year planning horizon; there are currently no such plans for MPFDC. The rating assumes sound coverage consistent with a history of self-supporting MPFDC and MEDC operations.

STRONG LOCAL ECONOMY WITH GROWTH PROSPECTS
The city participates in the Dallas Fort Worth (DFW) regional economy. Located in the southeastern portion of Tarrant County, the city is directly connected to nearby Dallas and Fort Worth, the DFW International Airport and surrounding communities by a robust and expanding transportation network. Given the regional infrastructure and proximity to the metroplex, the city is well positioned for additional growth.

Median household income is high at 77% above the national average. The city's levels of educational attainment trend well above average and contribute to a low unemployment rate of 3.4% as of September 2015.