...S&P Global Ratings assigned its 'A+' long-term rating on the Philadelphia Authority for Industrial Development's series 2017 city service agreement revenue bonds for the City of Philadelphia Affordable Housing Preservation Programs Project. The outlook is negative. The negative outlook reflects our concerns regarding the city's multiyear deficit trend resulting in reserves we view as weak and what we consider to be a very large unfunded pension liability. Potential downward rating action is likely if over the next one-to-two years, the city's reserves weaken beyond projections, revenue growth trends weaken, or the pension funding level does not improve. The authority's city service agreement revenue bonds are limited obligations of the city, payable solely from service fees from the city to the authority under the city service agreement. Although current city revenue secures the service fees, the city service agreement provides that as long as the bonds remain outstanding, Philadelphia's...
