The ratings on Philadelphia Gas Works' (PGW) bonds reflect the approval of the base rate increase by the Pennsylvania Public Utility Commission (PUC), the Philadelphia city council's decision to extend repayment of the working capital loan, and improvement in collections, resulting in a decline in accounts receivables. These strengths are offset by PGW's problems with high accounts receivables, a weak liquidity position, and low, although improving, fixed-charge coverage. PGW, the largest municipally owned gas utility in the U.S., purchases, sells, and distributes gas to more than a half-million customers within the city of Philadelphia. The ratings affect about $365.4 million of 1975 ordinance bonds, and $480.9 million of senior and $17.4 million of subordinate 1998 ordinance bonds. The rating affirmation
