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Rating Action: Moody's assigns Aa3 to the RTC of Southern Nevada's (NV) indexed motor vehicle fuel tax bonds, Series 2021; outlook stableGlobal Credit Research - 09 Apr 2021New York, April 09, 2021 -- Moody's Investors Service has assigned an Aa3 to the Regional Transportation Commission of Southern Nevada's $100 million Highway Revenue Bonds (Indexed Fuel Tax and Subordinate Motor Vehicle Fuel Tax), Series 2021. Moody's maintains Aa3 ratings on the RTC's $241.6 million in parity motor vehicle fuel tax bonds, as well as the Aa3 ratings on the RTC's $345.9 million in outstanding indexed fuel tax bonds and Aa2 ratings on the $33.6 million of the RTC's sales and excise tax bonds,. The rating outlook is stable.RATINGS RATIONALEThe Aa3 rating on the motor vehicle fuel tax bonds reflects healthy debt service coverage despite recent declines due to the coronavirus pandemic, which has significantly curtailed economic activity in the tourism-driven region. The rating takes into account the large service area that includes Las Vegas and historically stable fuel demand that is showing signs of recovery as businesses, including casinos and resorts, re-open. The rating also incorporates strong legal protections, including a 1.5x additional bonds test and a debt service reserve equal to 125% of average annual debt service, 100% of MADS or 10% of bond proceeds. Although not pledged, the RTC has a substantial cash balance in addition to debt service reserve funds that can be used to support debt service or operating activities, which is an added credit strength.RATING OUTLOOKThe stable outlook reflects our expectations that debt service coverage will remain healthy even as near-term fuel demand remains suppressed because of the coronavirus pandemic. The outlook also incorporates Clark County's important role as the economic hub and population center of Nevada, which historically benefits from large tourism inflows to the Las Vegas area. Additionally, the RTC's strong liquidity position provides a meaningful buffer to sustained economic weakness through the outlook period.FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING- Significant growth in taxable fuel sales resulting in strong improvement in debt service coverageFACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING- A significant and protracted decline in pledged revenue leading to lower debt service coverageLEGAL SECURITYThe indexed bonds are secured by a senior lien on incremental fuel taxes from tax rate indexing within Clark County, as well as a subordinate lien of the commission's county and state-shared motor vehicle fuel taxes.The fuel tax bonds are secured by a senior lien of the commission's county and state-shared motor vehicle fuel taxes. Bondholders have no claim on indexed fuel taxes.USE OF PROCEEDSProceeds from the bonds will be used to pay the costs of construction and improvements of certain major streets and highways throughout Clark County.PROFILEThe Regional Transportation Commission of Southern Nevada is a component unit of Clark County (Aa1 stable) and is both the transit authority and transportation planning agency for the region. Its responsibilities include management of transportation-related funds and capital planning, along with operating the area's fixed-route bus system and para-transit services. The county has approximately 2.3 million residents.METHODOLOGYThe principal methodology used in this rating was US Public Finance Special Tax Methodology published in January 2021 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBM_1260087. Alternatively, please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.REGULATORY DISCLOSURESFor further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody's Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004For ratings issued on a program, series, category/class of debt or security this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series, category/class of debt, security or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. 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