Fitch Rates PICA $214.6MM Special Tax Rev Rfdg Bonds 'AAA/F1+'

Business Wire,  May 14, 2008  

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NEW YORK -- Fitch Ratings has assigned a rating of 'AAA/F1+' to the $133,740,000 series of 2008A and $80,825,000 series of 2008B Pennsylvania Intergovernmental Cooperation Authority (PICA) special tax revenue refunding bonds (City of Philadelphia Funding Program).

The long-term 'AAA' rating assigned to the bonds is based on the support provided by the financial guaranty insurance policy issued by Financial Security Assurance Inc (FSA). The policy, which insures scheduled payments of principal and interest, extends to the maturity of the bonds. The short-term 'F1+' rating on the bonds is based on the liquidity support of the standby bond purchase agreement (SBPA) provided by JPMorgan Chase Bank, N.A. The SBPA provides for the payment of the principal component of purchase price and up to 34 days of interest calculated at a maximum rate of 12% per annum based on a year of 365 days. The SBPA will expire on May 14, 2009, unless extended or upon any earlier termination of the SBPA, all in accordance with its terms. The remarketing agent for the series of 2008A&B bonds is RBC Capital Markets Corporation. The bonds are expected to be delivered on or about May 15, 2008. For more information on the underlying credit, please refer to the press release on PICA published on May 5, 2008, available on the Fitch website at www.fitchratings.com.

The bonds initially bear interest in the weekly rate mode, but may be converted to bear interest at the daily, flexible, term, or fixed rate modes. While the bonds bear interest in the weekly and daily rate modes, interest is payable on the fifteenth day (or the next succeeding business day if the fifteenth is not a business day) of each month. Holders of bonds bearing interest at a daily, weekly, or term rate mode may tender their bonds for purchase with prior notice. The SBPA covers bonds in the daily and weekly rate modes.

The bonds are subject to a mandatory tender upon conversion of the interest rate modes, upon the expiration or substitution of the SBPA, and upon the occurrence of certain events of default under the SBPA. The bonds are also subject to mandatory and optional redemption provisions.

The proceeds of the bonds will be used to (i) refinance certain special tax revenue refunding bonds and (ii) pay the cost of obtaining credit enhancement for and the costs of issuing the 2008A and B bonds.

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.

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