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DUFF & PHELPS: DUFF & PHELPS DOWNGRADES E.I.P. FUNDING TO 'BB-'; FIRST PV FUNDING TO 'B+' (LESSEE: PUBLIC SERVICE COMPANY OF NEW MEXICO)

 CHICAGO, Feb. 18 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has lowered the rating of E.I.P. Funding Corporation's secured lease obligation bonds to BB-' (Double-B-Minus) from BB+' (Double-B-Plus). The rating of First PV Funding Corporation's lease obligation bonds has also been lowered to "B+" (Single-B-Plus) from "BB+" (Double-B-Plus). Both are indirect obligations of Public Service Company of New Mexico (PNM).
 The downgrade actions reflect the uncertainty surrounding Public Service Company of New Mexico's recently announced commitment to lower its electric rates. A bill currently under consideration by the New Mexico legislature in support of retail wheeling adds to this uncertainty. The company intends to file a rate plan this summer which will address retail wheeling and the competitive marketplace for electric power. Should rate reductions transpire, debt protection measures could be negatively impacted; the lease obligation bonds, as indirect obligations of PNM, would be more exposed to negative impacts than its other securities.
 The high plant cost and excess capacity problems associated with Palo Verde suggest that First PV Funding Corporation securities would be more impacted by negative developments than those of E.I.P. Funding Corporation. The E.I.P. Funding Corporation arrangements relate to transmission properties. The First PV Funding Corporation securities remain on Rating Watch -- Unfavorable for reasons unrelated to this release.
 -0- 2/18/93
 /CONTACT: John C. Dell of Duff & Phelps, 312-368-3161/


CO: E.I.P. Funding Corporation; First PV Funding Corporation ST: IN: FIN SU: RTG

TS -- NY035 -- 7801 02/18/93 10:51 EST
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Date:Feb 18, 1993
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