The 'BBB' underlying rating on Philadelphia Authority for Industrial Development, Pa.'s bonds reflects security provided by a service agreement with Philadelphia and therefore reflects the city's 'BBB' GO rating (stable outlook). The GO rating was affirmed in November 1998. The bonds are expected to receive an 'AAA' rating based on FSA, MBIA, and AMBAC bond insurance. Philadelphia's key credit characteristics include: * A trend of sound financial operations, producing six consecutive years of balanced operations; * A demonstrated trend in budgeting and long-term financial planing; and * The presence of the Pennsylvania Intergovernmental Cooperation Authority, the fiscal oversight authority. These factors are constrained by: * Below-average economic trends; * A tax base that has been slow to recover from the
