Fitch Rates Johnson Co. Park & Rec District, Kansas 'AA-'.

Business Editors

CHICAGO--(BUSINESS WIRE)--Nov. 15, 2002

Fitch assigns an 'AA-' rating to the $14,245,000 Johnson County Park and Recreation District, Kansas certificates of participation (COP's) series 2002A. The certificates are scheduled for competitive bid on November 20, 2002. Dated December 1, 2002, the COP's mature serially September 1, 2003 - 2022, pay semiannual interest commencing March 1, 2003, and are subject to optional and extraordinary optional redemption prior to maturity. In addition, the certificates represent an undivided ownership interest in the right to receive base lease payments under the lease agreement. The COP's are payable solely from legally available funds of the district and are subject to annual appropriation by the district board. Annual appropriations by the district are further subject to approval by the Johnson County Board of County Commissioners. Certificate proceeds will be used to acquire approximately 400 acres of parkland and to make improvements to existing parks; this is a par t of the districts 20-year long-range master action plan to meet parkland and recreational facility needs.

The underlying 'AA-' rating reflects sound legal provisions, a strong incentive and intent from the district and county to make annual lease appropriations and above average general credit characteristics, which include a growing and diverse tax base, high wealth levels, a low debt burden and balanced financial operations. The county board passed a resolution stating its intent, subject to annual appropriations made by the district board, to approve future funding for the certificates until final maturity in 2022. The county board's authority to select the park district board members and approve all district appropriations potentially decreases non-appropriation risks in future years. Non-appropriation risks are also offset, to some extent, by the district's county-wide importance and sizeable park constituency.

The certificates are issued pursuant to a lease purchase agreement between the district and the trustee, which also serves as the lessor. The sound legal provisions under the lease agreement including the district's covenant to make timely budget requests to the district board for appropriation for the lease payments enhances certificate holder security. In addition, the certificates provide a debt service reserve fund totaling 10% of the certificate par amount. The district will fund lease payments from its statutory maximum 2.0- mill property tax operating levy. Financial flexibility exists as the district currently levies 0.95 mills, which is well below the operating maximum. The district's general fund operations have remained balanced over the past several years. Each year, unencumbered general fund balances are transferred to the park fund for future park acquisitions, leaving a minimal general fund balance.

Coterminous with Johnson County, the district is located in northeastern Kansas and directly west of Kansas City, Missouri. With a 2000 population of 451,086, the district encompasses over 6,500 acres of parkland and maintains 15 major parks and recreation facilities. In 2001, more than 4,000 recreation programs served approximately 1.6 million participants, attesting to the stability and the sizable constituency of the park district.

Well known for its nationally ranked schools, and high quality neighborhoods, Johnson County's economy continues to grow and diversify. Since 1996, the tax base grew 8.5% annually. Furthermore, wealth indicators are above average with district per capita income exceeding state and national levels by 57%, and 47%, respectively.