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MICHIGAN $435 MILLION TRANSPORTATION BONDS RATED 'AA-' BY FITCH -- FITCH FINANCIAL WIRE --

 MICHIGAN $435 MILLION TRANSPORTATION BONDS RATED 'AA-' BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, July 2 /PRNewswire/ -- Michigan's $119 million Comprehensive Transportation Bonds, Series 1992A and refunding Series 1992 B, are rated 'AA-' by Fitch. The state's $276 million State Trunk Line Bonds, Series 1992A and Refunding Series 1992 B are also rated 'AA-'. The ratings also apply to $206.8 million outstanding Comprehensive Transportation Bonds and to $275.3 million outstanding state trunk line bonds. The credit trend is stable. The new bonds are expected on July 8, through negotiation with a syndicate headed by Merrill Lynch & Co. Details on the structure of the new issues, including maturity amounts and call features, have not yet been determined.
 The transportation bonds are not general obligations of Michigan but are payable from specific portions of highway related revenues, which in the state are constitutionally dedicated to transportation purposes. The comprehensive transportation bonds have a first lien on the fund of the same name which currently receives 10 percent of highway-related revenues as well as a distribution from the sales tax on motor vehicles. Revenues to the fund in 1990-91 would provide over six times coverage for future maximum annual debt service on the bonds. The trunk line bonds have a first lien on the state trunk line fund, which in essence receives the share of highway-related taxes, after specific distributions including the comprehensive transportation fund, that is distributed for state highway purposes. Coverage for maximum future debt service is wide, at about eight times.
 While highway-related taxes have shown little growth in recent years, and this pattern is generally expected to continue, they are a stable source of revenue. Each fund provides wide coverage for the debt service which must be met and additional bonds cannot be issued unless coverage is at least two times, a good level. Future borrowing for these purposes is not expected to be large.
 -0- 7/2/92
 /CONTACT: Claire Cohen of Fitch, 212-908-0552/ CO: ST: Michigan IN: SU: RTG


SM -- NY032 -- 6141 07/02/92 11:41 EDT
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Date:Jul 2, 1992
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