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Summary: Indian River County, Florida; Miscellaneous Tax The half -cent sales tax is levied on the sales price of each item or article of tangible personal property. The tax is levied and collected by the state and distributed monthly to Indian River County and municipalities within the county based on the population of the unincorporated and incorporated areas within the county. The revenue pledges from both the fourth -cent tourist development tax and the local government half -cent sales tax cease and terminate for bonds maturing after April 1, 2021. The remaining bonds, which mature from April 1, 2022 to 2031, will be secured solely by the state payments. We note that the county's board approved partial payoffs of the series 2001 spring training bonds in June 2013 totaling $2.3 million, and more recently in December 2018 totaling $1.1 million. We understand that these partial payoffs have already eliminated the need to use half -cent sales tax revenues and fourth -cent tourist development revenues for debt service repayment. As a result, state payments of $500,000 are currently sufficient to cover debt service. The rating reflects our opinion of Indian River County's: • Merely sum -sufficient debt service coverage beginning in fiscal 2022, when state payments will be the only revenue source securing the bonds; • Very strong debt service coverage from pledged revenue for the bonds maturing through 2021, in addition to the lack of additional debt plans; • Good income levels and adequate per capita retail sales; and • Adequate 1.25x maximum annual debt service (MADS) additional bonds test (ABT) for additional bonds secured by revenue from the half -cent tax. Economic fundamentals: Very strong Our economic fundamental assessment is based on the economic underpinnings of the state given annual $500,000 payments received by the county, the only revenue source starting in 2022, are from Florida and collected statewide. Florida's economy continues to outperform that of the nation with good population growth and positive net migration. The state estimates that it gained 340,000 residents in fiscal 2018 including an estimated 53,000 residents displaced from Puerto Rico after Hurricane Maria and who are expected to stay in Florida. Job growth in the state continues to outpace that of the nation with a 2.7% increase in payrolls in October 2018 that ranks Florida among the top -10 states for employment growth. However, growth has moderated somewhat. Gains in employment reflect broad-based growth across most sectors, particularly supported by construction employment. IHS Markit forecasts Florida's employment will continue to post higher -than -national growth at 3.7% and 2.7% in calendar years 2018 and 2019, respectively, before slowing to a predicted 2.4% and 1.9% in 2020 and 2021, respectively. The preliminary unemployment rate for December 2018, at 3.3%, was slightly below that of the nation's 3.9%. A relatively higher concentration of employment in the leisure and hospitality sector and a larger proportion of retirees somewhat dampen state income levels. Florida's per capita personal income stayed level in 2017 and represented what we consider a still -good 93% of the national level. Revenue volatility: Low We assess the volatility of revenues to determine the likelihood of the availability of revenues during different WWW.STANDARDANDPOORS.COM/RATINGSDIRECT MARCH 29, 2149 3