...The 'AA¡' rating on the Oklahoma Capitol Improvement Authority's (OCIA) state facilities revenue bonds is directly linked to the state's 'AA' Long-Term Issuer Default Rating (IDR). The one-notch rating differential reflects a slightly elevated risk of non-appropriation of moneys sufficient to pay debt service on the bonds, given the optionality inherent in repayment of bonds from budgetary appropriations. Oklahoma's 'AA' IDR reflects a low long-term liability burden and Oklahoma's still sizable concentration in natural resource development industries, which limits its long-term revenue growth prospects while increasing tax revenue volatility. The state's reserves have been strongly affected by economic cycles in the past. Fitch Ratings expects that this may remain the case over the medium term. However, Oklahoma's fiscal reserve cushion is now at its highest-ever level. The Positive Rating Outlook reflects sustained improvements in Oklahoma's expenditure flexibility and overall fiscal management...
