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LUTHERAN SOCIAL SERVICES OF ILLINOIS $17.8 MILLION SERIES 1993 BONDS 'BBB' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, July 12 /PRNewswire/ -- The Illinois Health Facilities Authority's $17.8 million revenue bonds, series 1993, issued for Lutheran Social Services of Illinois (LSSI), are rated 'BBB' by Fitch. The credit trend is stable. Proceeds primarily will be used to advance refund outstanding series 1990 bonds and fund a debt service reserve. The bonds are expected to be priced through negotiation by George K. Baum & Co. during the week of July 26.
 The rating is supported by LSSI's long history of providing social services in Illinois and the breadth and diversity of the services provided. LSSI benefits from a sound management team that has generated consistent excess profits and accumulated a solid cash cushion. Historical pro forma maximum annual debt service (MADS) was a strong 3.4 times (x) in 1992, and the cushion ratio was a high 11.4x. The debt load is moderate. MADS as a percent of total revenues is very conservative, only 2.2 percent in 1992, and the debt-to-capitalization ratio is manageable at just over 50 percent.
 LSSI annually generates operating losses that historically have been offset by contributions and investment income. The reliance on contributions to fund operations is a concern, although LSSI demonstrates sound fund-raising abilities. Furthermore, in the event of any decline in contributions, LSSI has significant flexibility to adjust its service mix. Program flexibility, including LSSI's ability to respond quickly, is important in view of LSSI's payor mix. The payor mix primarily consists of various state agencies that contract with LSSI annually. In 1992, revenues form state agencies accounted for just 60 percent of LSSI's total revenues. LSSI has longstanding working relationships with the various agencies and overall funding has increased substantially over the last several years.
 LSSI is headquartered in Des Plaines, IL and provides a variety of social services throughout the state. These services include child welfare, long-term care, family and mental health, and alcohol and substance abuse.
 -0- 7/12/93
 /CONTACT: Michele Cebron of Fitch, 212-908-0591/


CO: Lutheran Social Services of Illinois ST: Illinois IN: SU: RTG

SH -- NY058 -- 0472 07/12/93 13:44 EDT
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Date:Jul 12, 1993
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