Fitch Rates Fort Pierce Utilities Authority's -FL- $47MM Revs 'A-'.

Business Editors

NEW YORK--(BUSINESS WIRE)--June 3, 2003

Fitch Ratings assigns an 'A-' rating to Fort Pierce Utilities Authority's (FPUA) $47 million in utility revenue refunding bonds. Fitch also affirms the 'A-' rating on FPUA's outstanding $50 million revenue bonds. The Rating Outlook is Stable. Proceeds will advance refund FPUA's outstanding series 1993 bonds. The redemption date is Oct. 1, 2003. The bonds are expected to price the week of June 10, 2003 with Sun Trust Capital Markets as lead underwriter. Ambac is expected to provide bond insurance.

The 'A-' rating reflects FPUA's solid financial performance, a favorable customer base and a reliable source of power. FPUA benefits from a residential and commercial customer base with no significant concentration: the top 10 utility customers accounting for approximately 18% of total combined revenues, with no single customer accounting for more than 4% of total combined revenues. FPUA's participation in Florida Municipal Power Agency's (FMPA) All-Requirements Project (rated 'A+' by Fitch) ensures a stable power supply at a reasonable rate.

Credit concerns include the minimal growth in the service territory, electric retail rates that are above average for Florida and high fixed costs associated with FPUA's participation in the St. Lucie nuclear project (rated 'A-' by Fitch). While retail rates are somewhat high (about 8.72 cents/kilowatt hour in 2003 for residential customers), the state's slow movement toward electric restructuring mitigates the threat of competition.

Financial performance has been consistently strong, with debt service coverage of 2.71 times (x) in 2002. Adjusted to reflect FPUA's obligations as a participant in the FMPA projects, debt service coverage was 1.64x. FPUA's equity to total capitalization as of Dec. 31, 2002 was 50%, or 34% on an adjusted basis. This adjusted figure, somewhat low for the rating category, is due primarily to the higher fixed costs of the St. Lucie plant. Liquidity resources are solid and include cash reserves sufficient to meet operating expenses for 104 days.

Fort Pierce Utilities Authority is a combined electric, water, natural gas and wastewater system located on the central east coast of Florida. The electric system, which accounts for the bulk of revenues (70% for 2002), serves 25,300 residential and small commercial customers. FPUA's service territory includes the corporate limits of the city of Ft. Pierce and some unincorprated portions of St. Lucie County. FPUA receives its power supply via FMPA's All-Requirements and St. Lucie projects.