Correction: Fitch Rates Trumbull, Connecticut GOs 'AA'; BANs 'F1+'.

Business Editors

WASHINGTON--(BUSINESS WIRE)--Aug. 28, 2002

(this is an amended version of a press release issued yesterday, containing revised information on the Rating Outlook, as well as the sale date for the GO bonds and notes)

Fitch Ratings assigns an 'AA' rating to Trumbull, CT's $16.44 million general obligation bonds, series A and approximately $13.85 million general obligation refunding bonds, series B. The Rating Outlook is Positive for Trumbull's general obligation rating. Concurrently with the bonds, Trumbull is also offering $25.79 million of general obligation bond anticipation notes (BANs), which are rated 'F1+'. The bonds and notes are scheduled for competitive bid on Sept. 4.

The 'AA' rating for this affluent suburban community is based on Trumbull's (the town) steady economic expansion, an improving financial profile, and a modest debt burden with manageable future capital needs. Under new elected leadership, the town is making steady progress in building reserves while improving upon its pension contribution rate. The Rating Outlook is Positive reflecting Fitch's expectations that careful planning and steady tax base growth will allow for the ongoing buildup of fund balance and continued adherence to a pension funding plan that calls for annual increases to employer contributions. These goals must be met in conjunction with the absorption of the operating budget and debt service impacts of a new elementary school set to open next year. The 'F1+' rating on the BANs reflects the high probability that the town will maintain market access to permanently finance the notes at a later date.

Trumbull is a wealthy, chiefly residential, Fairfield County community located north of Bridgeport and equidistant from Hartford and New York City. While many residents commute to New York or to the numerous corporate headquarters facilities in southwestern Connecticut, Trumbull has its own ample employment base made up primarily of health and business services and retail trade. The Trumbull Shopping Park, a regional mall, employs 3,000 and Oxford Health Plans, the town's largest single employer, provides 1,400 jobs. Employment at NASDAQ, Inc.'s computer operations center nearly tripled over the past decade and investments in new equipment are adding substantially to the personal property base. Further expansions at Unilever, Inc and NASDAQ will add to the grand list in the next two years. Overall, the net taxable grand list grew by 5.1% per year since fiscal 1997; this gain includes the effects of a 2000 revaluation that boosted property values by 18.8%. Market value per capita is a high $140,222. Per capita income is 121% of Connecticut's high average and 162% of the national average. Unemployment rates are typically below the state and nation.

The town's financial picture is stable, although reserves are still somewhat below average for the rating category. Property tax receipts account for 90% of the budget and a strong rate of current collections provides revenue stability. Education is the principal funding obligation of the town, making up 60% of the budget; and is typically the largest claim on new resources. One of the new administration's policy goals has been to increase unreserved general fund balance to 5% of spending, a level that may be achieved when final fiscal 2002 audit figures are available. The town plans mill rate adjustments to further boost reserves while increasing payments to its two single-employer defined benefit pension plans, and meeting its debt service commitments to the new school. The police and town employee pension plans remain underfunded at 74% and 59%, respectively, despite annual increases in contributions. Recently, weak investment performance has hampered funding progress.

A mature community, Trumbull's infrastructure is largely in place, limiting future capital needs. Giving self-supporting credit to town general obligation bonds issued for the sewer system, debt levels are moderate at $2,329 per capita and 1.7% of market value. Amortization is rapid at 73% in ten years. The bulk of Trumbull's five-year $52 million capital improvement plan is for a contemplated new school. If constructed, approximately 32% of the facility's cost may be payable from state progress payments. The new borrowing is planned through 2008 and will be approximately equal to debt retirement over that period. Debt service is projected to be 7.4% of general fund spending for the 2003 budget and should remain below the town's informal 10% limit, even as the new debt is sold.