Institutional framework and management support ratings. Institutional framework promotes a strong management culture, fiscal discipline, and high levels of financial disclosure. Economy is growing well, with 3.9% GDP growth during the year ended Sept. 30, 2018, backed by strong dairy and construction sectors. It still lags behind the broader New Zealand economy. Management is focused on delivering its long-term plan, and we do not expect ongoing political disagreements will weigh on Horowhenua's credit profile. A relatively large capital program is weighing on Horowhenua's financial position. High capital expenditure will ensure after-capital account deficits average 16.9% of total revenues until 2021. These deficits will drive debt to 204.4% of operating revenues by 2021. Liquidity coverage is adequate compared with its peers.
