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VIRGINIA'S $24.4 MILLION G.O. BONDS RATED 'AAA' BY FITCH -- FITCH FINANCIAL WIRE --

 VIRGINIA'S $24.4 MILLION G.O. BONDS RATED 'AAA' BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, Nov. 12 /PRNewswire/ -- The Commonwealth of Virginia's $24.44 million higher educational institutions bonds, series 1992 D, offered for bids on Nov. 18, are rated 'AAA' by Fitch. The 'AAA' rating assigned to $575.1 million outstanding general obligations is also affirmed. The credit trend remains stable.
 The new bonds, general obligations of the Commonwealth which pledges its full faith and credit, are issued under Article X, Section 9(c) of the constitution. The participating higher educational institutions pledge project net revenues sufficient to meet debt service on the Section 9(c) bonds. The new bonds will be due June 1, 1994-2013 and will become callable beginning June 1, 2002, at 102 percent.
 Virginia's substantial resources, conservative approach to financial operations, and careful attention to both the level and security of its debt obligations provide superior protection to bondholders. Despite the severity of the recession and the magnitude of the necessary downward adjustment to new economic conditions, Virginia has kept its financial operations in balance.
 Operations in 1991-92 were somewhat more favorable than expected and the year closed with a general fund balance of $195.1 million of which $52.8 million represents unreserved, undesignated surplus.
 For the first quarter of the current fiscal year, revenues are slightly above expectations.
 The economy continues to reflect recessionary conditions, with employment some 3 percent below the 1990 peak and personal income growth lagging the national rate. A slow growth pattern is expected to prevail over the next few years, influenced in part by planned reductions in national defense spending.
 Debt of the Commonwealth remains low, with net tax supported debt of $1.5 billion equal to $253 per capita, 0.5 percent of estimated full value of property and 1.2 percent of personal income. At the November election, voters approved a total of $612.9 million general obligation bonds for higher education, mental health and parks. Even with the inclusion of this new authorization and remaining other authorizations, debt would remain low at a little more than 2 percent of personal income.
 Voters also approved constitutional status of a Rainy Day Fund. Deposits would begin in fiscal 1995 and the fund would be available to cover future revenue shortfalls. In line with Virginia's conservatism, withdrawals would be subject to appropriation and possible only in conjunction with expenditure cuts.
 -0- 11/12/92
 /CONTACT: Claire G. Cohen of Fitch, 212-908-0552/ CO: ST: Virginia IN: SU: RTG


KD -- NY103 -- 0419 11/12/92 17:28 EST
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Publication:PR Newswire
Date:Nov 12, 1992
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