Standard&Poor's Ratings Services assigned its 'AA' rating to Pennsylvania Housing Finance Agency's (PHFA's) series 2005A bonds, reflecting: The strong security of pledged federal public housing modernization funds (the capital fund) that each participating housing authority receives annually from HUD; Anticipated bond debt-service coverage for each authority of at least 3x through bond maturity; Demonstrated HUD support for the transaction, limiting the risk of any sanctions that can jeopardize the flow of funds to bondholders; Administrative oversight of the authorities provided by PHFA; A fully funded debt service reserve fund sized at maximum annual debt service (MADS) for each authority; and The sound legal structure of the transaction, which serves to insulate bondholders from the risks of each authority's
