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Fitch Rates California Pollution Control Fin Auth 2012 VRDBs (The Ratto Gp of Cos., Inc. Proj)'A/F1'

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NEW YORK--(BUSINESS WIRE)--

Fitch Ratings assigns a rating of 'A/F1' with a Stable Outlook to the $16,500,000 California Pollution Control Financing Authority, variable rate demand solid waste disposal revenue bonds (The Ratto Group of Companies, Inc. Project) Series 2012. The rating is based on the support provided by an irrevocable direct- pay letter of credit (LOC) issued by Union Bank, N.A. (rated 'A/F1', Stable Outlook).

The bank is obligated to make payments of principal of and interest on the bonds upon maturity, acceleration and redemption, as well as purchase price for tendered bonds. The ratings will expire upon the earliest of: (a) Oct. 31, 2017, the initial stated expiration date of the LOC, unless such date is extended; (b) conversion to a term rate mode; (c) any prior termination of the LOC; and (d) defeasance of the bonds. The LOC provides full and sufficient coverage of principal plus an amount equal to 45 days of interest at a maximum rate of 12% based on a year of 365 days and purchase price for tendered bonds, while in the weekly rate mode. The Remarketing Agent for the bonds is Westhoff, Cone & Holmstedt. The bonds are expected to be delivered on or about Oct. 31, 2012.

The bonds initially bear interest at a weekly rate, but may be converted to a term rate. While bonds bear interest in the weekly rate mode, interest payments are on the first Wednesday of each month, commencing Dec. 5, 2012. The trustee is obligated to make timely draws on the LOC to pay principal, interest, and purchase price. Funds drawn under the LOC are held uninvested, and are free from any lien prior to that of the bondholders. Holders may tender their bonds on any business day, provided the trustee or tender agent is given the requisite prior notice of the purchase. The bonds are subject to mandatory tender: (1) upon conversion of the interest rate; (2) upon substitution of the LOC; and (3) on the second business day following receipt of written notice from the bank of an event of default under the reimbursement agreement. The bank has the option of directing an acceleration rather than a mandatory tender upon an event of default under the reimbursement agreement. The bonds shall be accelerated following the trustee's receipt of notice of non-reinstatement of the LOC interest. Optional and mandatory redemption provisions also apply to the bonds, including a mandatory redemption upon expiration of the LOC. There are no provisions for the issuance of additional bonds.

Bond proceeds will be used to finance the improvement, renovation, rehabilitation and/or installation of a materials recycling facility, shop, offices and related facilities and equipment and (ii) acquisition of trucks and other solid waste vehicles and equipment, used for the collection, handling, processing or disposal of solid waste and (iii) solid waste carts, bins and containers to be located at customers' locations in the The Ratto Group of Companies, Inc. service territory in Sonoma or Marin Counties, California.

Additional information is available at www.fitchratings.com. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'U.S. Municipal Structured Finance Criteria' (Feb. 28, 2012);

--'Rating Guidelines for Letter of Credit-Supported Bonds' (June 20, 2012).

Applicable Criteria and Related Research:

U.S. Municipal Structured Finance Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=672570

Rating Guidelines for Letter of Credit-Supported Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=681737

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Fitch Ratings
Primary Analyst
Ronald P. McGovern
Senior Director
+1-212-908-0513
Fitch, Inc.
One State Street Plaza
New York, NY 10004
or
Secondary Analyst
Mario Civico
Senior Director
+1-212-908-0796
or
Committee Chairperson
Joseph Staffa
Senior Director
+1-212-908-0829
or
Media Relations
Elizabeth Fogerty
+1-212-908-0526
elizabeth.fogerty@fitchratings.com

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