Standard&Poor's Ratings Services has assigned its 'BBB' rating to the Watsonville Redevelopment Agency, Calif.'s 2004 tax allocation bonds. The rating reflects: A large project area totaling 1,830 acres with good growth in assessed valuation (AV) averaging 4.7% a year following the 2002 amendment; A local economy predominantly centered on agriculture with a growing presence of manufacturing and service-related industries; Good projected housing and nonhousing debt service coverage of 1.54x maximum annual debt service (MADS), based on 2004 tax increment revenues; and A good additional bonds test. Offsetting factors include: A relatively high volatility ratio of 0.56, indicating sensitivity in revenues to overall fluctuations in AV; and Some concentration in the tax base, with the top 10 accounting for
