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HOUSTON, TX $100 MILLION TRANs SERIES 1993 RATED 'F-1+' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, June 10 /PRNewswire/ -- Houston's $100 million Tax and Revenue Anticipation Notes Series 1993 are rated "F-1+" by Fitch. The one-year notes will be sold competitively June 16.
 The notes' highest credit quality rating is based on an expected early note repayment set-aside and the availability of additional cash resources that the general fund can borrow from in the event of a cash flow shortfall. Although the projected cash flow for fiscal 1994 is balanced narrowly and based on a projected budget, the city's intention to set aside funds in May for the note repayment due in June provides flexibility. The availability of borrowable funds provides a cushion for the notes' repayment in case cash flow variances occur.
 Although the city's projected cash flow for fiscal 1994 is similar to the current year's and weaker than in the past, the availability of a conservatively projected $16 million in borrowable resources enhances the city's ability to repay the borrowing on a timely basis. Also, the city intends to segregate funds to provide for the note repayment in May, creating flexibility in the event of a cash shortfall in the last month of the fiscal year. The note repayment coverage by net revenue in May is good at 1.45 times. The proposed fiscal 1994 budget is balanced using a small expected operating surplus from 1993, higher delinquent tax collections as a result of a contract with a private firm, and various fee increases. Additional short-term borrowing midyear is expected, and likely will be done through a bank and repaid within a few months, as has been the case in recent years. The size of the additional borrowing will depend in the final budget and cash flow.
 -0- 6/10/93
 /CONTACT: Amy S. Doppelt, 212-908-0514, or Richard J. Raphael, 212-908-0506, both of Fitch/


CO: City of Houston ST: Texas IN: SU: RTG

GK -- NY075 -- 0786 06/10/93 16:20 EST
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Publication:PR Newswire
Date:Jun 10, 1993
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