S&P Rates Pomona Redev Agy 1998 Bnds Series Y 'BBB'.

NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 10/16/98--Standard & Poor's assigned its triple-'B' rating to Pomona Redevelopment Agency's 1998 tax allocation refunding bonds (West Holt Redevelopment Project) series Y.

The rating reflects the security provided by the first lien on tax increment revenues including funds that would otherwise be set-aside in the low and moderate income housing, net of tax sharing agreements from the West Holt Redevelopment Project Area (WHRPA). Bond proceeds will be used to refund a certain December 1993 loan agreement issued by the agency and finance improvements.

The rating reflects:

-- A medium-sized project area with a mix of industrial, commercial

and residential land uses;

-- Moderately low volatility in base-to-total assessed valuation

(AV) revenues, despite slight growth in assessed property

valuations;

-- Moderate concentration in the WHRPA's 10 leading taxpayers; and

-- Strong coverage of maximum annual debt service (MADS) and strong

additional bonds provisions, although the agency does not

anticipate issuing additional debt.

The WHRPA is located in Pomona (population 141,385), situated in Los Angeles County and approximately 30 miles east of Los Angeles, Calif. The WHRPA is a mixed use project area and covers 1,000 acres, or 6.7% of Pomona's total acreage. The WHRPA is zoned for 50% industrial use, 25% residential, 24% commercial, and 1% recreational use. The WHRPA is built-out.

In fiscals 1996 and 1997, the WHRPA experienced a countywide revaluation and successful tax appeals which reduced its AV by 6.6% to $278 million. In fiscal 1998, the closure of the General Dynamics plant along with further successful tax appeals, resulted in the WHRPA's AV declining to $254 million. The project area's 10 leading taxpayers is moderately concentrated at 34% of total AV and 51% of incremental value. The five largest taxpayers alone represent 36% of incremental value. The base-to-total AV revenue volatility is moderately low at 0.34. There are no new developments slated for fiscal 1999.

Fiscal 1999 pledged revenues provide strong coverage at 1.11 times (x) of MADS, after tax appeals are refunded. However, based on the assumption of the successful tax appeals average over the past three years and the addition of new developments to the tax rolls, the WHRPA's coverage of MADS will increase to 1.38x in fiscal 2000. The additional bonds test requires current coverage of maximum annual debt service of 1.25x from pledged tax increment revenues, although the agency does not anticipate issuing additional debt.

Pomona is mainly a mixed-use community consisting of residential, commercial, and industrial properties. Residents have employment opportunities within the city and have access to the greater Los Angeles County area. Pomona's population has been stable since fiscal 1995 at around 141,380. The median home price in Pomona is $150,000. As the state of California was in a recession from 1992-1995, the assessed property valuation of many cities within the state were negatively affected. Still experiencing lingering effects of the recession, Pomona has had stable assessed property valuations of around $4.6 billion since fiscal 1993. Pomona's wealth levels are below-average. The city's per capita effective buying income is below-average at just 64% of the state average and 62% of national averages. Also, median household effective buying income is below-average at 88% of the state average and 92% of the national averages.

OUTLOOK: STABLE

The outlook reflects the WHRPA's continued solid coverage of debt service on these bonds, and easy access to the Los Angeles County employment base for Pomona residents, Standard & Poor's said.--CreditWire