Fitch Rates Tampa, Florida $46.5MM Occupational License Tax Rfdg Bonds 'A+'.

NEW YORK -- Fitch Ratings assigns an 'A+' rating to the city of Tampa, Florida's (the city) approximately $46.5 million occupational license tax refunding bonds, series 2007. The bonds, expected to be insured, are scheduled to sell the week of March 20 through negotiation led by UBS Securities. Public Resources Advisory Group, Inc. serves as the city's financial advisor. Proceeds will be used to refund portions of outstanding parity debt for a net present value savings. At this time, Fitch also affirms the 'A+' rating on outstanding parity debt. The Rating Outlook is Stable.

The 'A+' underlying rating on the occupational license tax revenue bonds reflects adequate debt service coverage by the pledged revenue as well as the city's covenant to budget and appropriate any shortfall in debt service from non-ad valorem revenues. The occupational license tax alone provides satisfactory coverage, although in some years revenues from this source have declined slightly and coverage of maximum annual debt service (MADS) is slim at 1.33 times (x) based on unaudited fiscal 2006 results. Growth in the pledged revenue has been adequate, averaging 3% annually dating back to fiscal 1993. An additional bonds test requiring coverage by pledged occupational license tax revenues of 1.25x debt service should insure adequate bondholder protection, and the addition of the city's covenant to fund any deficiencies from its broad-based non-ad valorem revenue stream enhances security. The rating also considers the city's sound, diverse economy, positive financial position and moderate debt burden.

The City of Tampa is the largest city in Hillsborough County and the third most populous in Florida, located approximately midway along the west coast of the state on Tampa Bay. The city's population has grown moderately since the 2000 census, increasing by 7.4% to 325,989 in 2005. Once economically focused on tourism, construction, and the port, Tampa is now home to numerous headquarters and multinational finance and insurance companies. Wealth levels are on par with those of the county, and the city's unemployment rate continues to trend downward, comparing favorably to state and national averages.

The city's financial operations are consistently sound, marked by strong general fund reserve levels. According to unaudited results, fiscal 2006 ended with a sizeable $21.7 million operating surplus in the general fund driven primarily by property tax receipts coming in well above budget and only a nominal increase in overall general fund spending. The positive financial performance in fiscal 2006 increased the city's unreserved, undesignated general fund balance to approximately $48.2 million, representing a healthy 16.4% of expenditures and transfers out. By policy, the city maintains a general fund balance equal to at least $8.3 million for contingencies and, starting with an initial deposit of $3 million in fiscal 2006, will build an emergency reserve in the general fund that will eventually equal at least 5% of budgeted expenditures.

Overall debt levels are moderate at $3,106 per capita and 3.76% of taxable assessed valuation, and are not expected to increase significantly, as the city has limited borrowing plans over the next five years. The city's five-year $505 million capital improvement plan (CIP) is manageable and fully funded. The CIP largely targets water and wastewater system needs, public works projects, and general government improvements. Primary funding sources for the CIP include water and wastewater system debt issuance and net revenues and a significant amount of pay-as-you-go spending derived from excess gas tax, sales tax and utility tax revenue.

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