The rating on Philadelphia, Pa.'s bonds reflects a trend of sound financial operations, with balanced operations since fiscal 1995 without a need for a rate increase, and a consistently strong regulatory compliance record following the resolution of three environmental consent orders. The bonds are secured by system revenues. Additional strengths include: A regional provider of wastewater and water services to 11 wholesale customers, in addition to retail service to the city of Philadelphia; and Sound debt service coverage of senior revenue debt service managed to the 1.2 times (x) level following deposits to the capital and rate stabilization accounts. Offsetting factors include: Below-average collection rates, despite the improvement to 88% in fiscal 1998 following the implementation of monthly billing and
