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NORTH SLOPE BOROUGH (AK) $42.7 MIL GENERAL OBLIGATIONS RATED 'F-1' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, May 18 /PRNewswire/ -- North Slope Borough's (Ark.) $42.7 million (approximately) Taxable General Obligation Refunding Bonds Series 1993A are rated "F-1" by Fitch. The bonds will be sold through negotiation by George K. Baum on or about May 25 and mature June 30, 1994. The borough's $862 million outstanding "A-" parity debt is affirmed.
 North Slope Borough's credit quality rests in the sizable oil and gas reserves remaining in the area, and related ongoing private sector investment. Even though the oil and gas fields have entered declining production periods, output remains substantial and productive life has been extended by enhanced recovery methods. Assessed value now is projected to peak at just over $13 billion for fiscal 1996 and decrease thereafter. Debt service expense after this refunding peaks in fiscal 1994, and all bonds are retired by June 30, 2003.
 The borough's financial operations are sound, marked by satisfactory year-end fund balances and sizable reserves. The permanent fund totaled $259 million in fiscal 1992, and a $10 million contribution is planned annually for the next six years. While principal in this fund cannot be used without voter approval, interest income is transferred to the general fund for operating purposes. Also, the borough maintains an emergency debt service reserve fund equal to 15% of bond principal outstanding on all issues sold before June 30, 1992. However, only debt issued prior to this date has a claim on this reserve. When assessed value begins to decline, strong financial management will become increasingly important, since property tax rates are limited and most flexibility only exists on the expenditure side of the budget.
 The amount of district debt outstanding has been declining, with only two nonrefunding issues sold since 1985. As a result of the area's extremely high construction cost, and the wide variety of services the borough provides, the debt burden is high. Debt levels overall are affordable given the borough's tax base, and all bonds mature within 10 years.
 Bond proceeds will be used to refund the 1994 maturities of the borough's 1985 General Obligation Refunding Bonds Series D and E. The refunded bonds total $41 million, and will be called June 30, 1993 at 102 percent.
 -0- 5/18/93
 /CONTACT: Amy S. Doppelt of Fitch, 212-908-0514/


CO: North Slope Borough ST: Arkansas IN: SU: RTG

TS -- NY118 -- 9941 05/18/93 16:23 EDT
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Date:May 18, 1993
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