The rating on El Paso, Texas' bonds reflects: * Stable area economy, * Healthy customer base growth, * Strong debt service coverage, and * Low rates providing future rate flexibility. A higher rating is precluded by a large $300 million capital improvement program that is expected to be funded from about 50% debt issuance, and 50% from cash-on-hand and other revenues. El Paso provides water and sewer service to a population of about 601,700 in and outside the city. Annual customer base growth is a manageable 1.5%. Economic stability is provided by the Fort Bliss military base and a college and university. These sources of employment temper concerns related to 10% countywide unemployment over the past decade and income levels
