The rating on Glendale, Ariz.'s bonds reflects: Stable historical growth in Glendale's apportionment of highway user revenues (with the exception of a slight decline in 1998) combined with steady population growth, Glendale's (GO rated 'AA') strong and diversified economic base, Maximum annual debt service coverage of 2.29 times (x), and A 2.0x historical additional bonds test. Offset by The lack of a debt service reserve account, The potential for changes in statutory allocations of highway user revenues to Glendale that could lower coverage, and Fluctuations in motor vehicle registrations and motor vehicle fuel consumption. The bonds are secured by a first lien on highway user taxes, which are collected by the state and distributed monthly to the city under a
