Fitch Affirms Beaver Creek Metro District (Colorado) GOs at 'A'; Outlook Stable

NEW YORK--(Business Wire)--
Fitch Ratings, as part of ongoing surveillance, has affirmed the
'A' rating for Beaver Creek Metropolitan District, Colorado's (the
district) approximately $4.3 million in outstanding general obligation
bonds series 1998 and $692,000 in outstanding general obligation
refunding bonds, series 2001. The bonds are secured by the district's
full faith and credit pledge, payable from unlimited ad valorem taxes.
The Rating Outlook is Stable.

The rating reflects the district's high-value development,
affordable debt burden, and sound financial operations, coupled with
the vulnerability inherent to recreation and tourism-based economies.
With the district at about full build-out, property ownership is
relatively diverse, although the high share of residential properties
makes the district vulnerable to assessment ratio reductions under
Colorado's Gallagher Amendment. While most of the residences are
second homes, average values are extremely high.

Financial operations continue to retain sizable balances
sufficient to protect against economic fluctuations. For fiscal 2007,
the unreserved undesignated general fund balance stood at $3.5
million, representing over 90% of operating expenditures and transfers
out. For the close of fiscal 2008, officials project an increase to
the fund balance of approximately $500,000, primarily reflecting the
consolidation of proprietary funds into the general fund. The district
has no remaining authorization and capital needs appear to be limited.

Beaver Creek is part of the Vail-Beaver Creek resort area, a
natural tourist draw year-round, although visitation is focused in the
winter. The district is small, with a permanent population estimated
at only 300. The seasonal peak is substantially higher, utilizing the
district's high-end hotels, condominiums, town homes, and
single-family residences. Development had been strong in past years as
the district approached full built-out. The initial developer, Vail
Resorts, Inc., now represents a moderate 10% of total taxable value,
down slightly from prior year totals. Vail Resorts continues to be
committed to maintaining the area's strong tourism appeal, continually
developing ski-able terrain and other amenities.

Fitch issued an exposure draft on July 31, 2008 proposing a
recalibration of tax-supported and water/sewer revenue bond ratings
which, if adopted, may result in an upward revision of this rating
(see Fitch research 'Exposure Draft: Reassessment of the Municipal
Ratings Framework'.) At this time, Fitch is deferring its final
determination on municipal recalibration. Fitch will continue to
monitor market and credit conditions, and plans to revisit the
recalibration in the first quarter of 2009.

Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, www.fitchratings.com.
Published ratings, criteria and methodologies are available from this
site, at all times. Fitch's code of conduct, confidentiality,
conflicts of interest, affiliate firewall, compliance and other
relevant policies and procedures are also available from the 'Code of
Conduct' section of this site.

Fitch Ratings
Mark Campa, +1-512-215-3727 (Austin)
Cindy Stoller, +1-212-908-0526
(Media Relations, New York)
cindy.stoller@fitchratings.com

Copyright Business Wire 2008