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COUNTY CREDIT RATING DUE TO FISCAL ORDER

This letter is in reference to an article in the Oct. 4 News, "Naples welcomes upgrade in credit rating." A statement was made with respect to the relevance of the factors on which Moody's Investors Service based its recent credit rating upgrade of Erie County to "A2" from "A3."

I write to clear the record that rating agencies' municipal ratings are an invaluable tool used by investors in municipal bonds to assess an issuer's credit quality and to help determine the interest rates investors will charge an issuer. The rating agencies' assessments are well-regarded, comprehensive and independent opinions on credit and are based on fundamental, long-term credit factors rather than short-term, cyclical events.

The fact that within the past two months, the county's credit rating has been upgraded by two major rating agencies - Moody's this week to "A2" from A3" and Fitch in August to "AA-" from "A " - is a strong indication that the county's credit is solid and improving. The rating agencies made note of the slowing economy, weak tax collections and uncertainty in state aid, yet raised the ratings because of the county's strong fiscal management and demonstrated record of establishing good finances.

I hope this helps to clarify the respected and essential role that an issuer's ratings play in the municipal market, as well as the firm foundation on which rating agencies base upgrades.

GEORGE W. LEUNG

Director, Municipal Ratings Specialist

New York

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