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RIVERSIDE COUNTY (CALIF.) $33.8 MILLION COPS RATED 'A+' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Oct. 28 /PRNewswire/ -- Riverside County, Calif.'s $33.875 million certificates of participation (1993 Master Refunding Project) are rated `A+' by Fitch. The certificates will be sold through negotiation with PaineWebber on or about Nov. 3. The credit trend is stable.
 Riverside County currently is experiencing economic weakness following years of rapid development. The existing tax and employment base is diverse and able to support the county's operating and capital needs. Assessed value growth has slowed dramatically, but remains positive, indicating continued property sales and some building activity. Riverside's housing costs remain very low for the area, despite softening in the region's real estate markets. This cost advantage, and the county's substantial open space for development, along with its diverse climate and geography, will continue to make it a desirable location. However, healthy development levels will have to await a regional recovery.
 Financial operations have been satisfactory despite the economic decline and recent state actions. The general fund ran operating surpluses in five of the last six years, although the fiscal 1992 surplus occurred only after including a nonrecurring distribution of excess pension fund earnings. Fund balance levels have been good, with fiscal 1992 total fund balance equaling nearly 7 percent of expenditures, and the unreserved and undesignated portion at more than 5 percent. Estimates for fiscal 1993 indicate operations close to budget, in which a projected $78 million gap was closed. The ending fiscal 1993 fund balance is estimated at $18.5 million on a budgetary basis, 2 percent of the $928.8 million budget, although the ending GAAP balance is expected to be larger.
 The county's fiscal 1994 budget responds well to revenue declines resulting from the weak economy and the state's property tax shift. However, one-time revenue sources again are utilized. Budgetary pressures will continue, since nearly the full effect of the property tax shift will have to be addressed next year. Passage of the sales tax referendum would ease these pressures.
 Certificate proceeds will be used to refund four county lease obligations, although two of the issues were sold by issuing entities other than the county itself. The refunding is expected to yield $2.7 million in net present value savings, 8.3 percent of the refunded certificate and bond par amount. The county's debt ratios are moderate to high, but affordable.
 -0- 10/28/93
 /CONTACT: Amy S. Doppelt of Fitch, 212-908-0514/


CO: ST: California IN: SU: RTG

TS -- NY125 -- 8150 10/28/93 16:43 EDT
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Publication:PR Newswire
Date:Oct 28, 1993
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