Fitch to Confirm 'A-/F1' Rating on City of Irvine Reassessment Dist. No. 04-20

On the effective date of Feb. 3, 2014, Fitch Ratings will confirm the 'A-/F1' rating assigned to the $78,605,000 ($64,260,000 currently outstanding) City of Irvine (CA) Reassessment District No. 04-20 Limited Obligation improvement Bonds, Adjustable Rate Series A (the Bonds). The Rating Outlook is Stable, for the long-term rating. The rating action is in connection with: (i) the substitution of the irrevocable direct-pay letter of credit (LOC) previously provided by KBC Bank N.V. (rated 'A-/F1'; Stable Outlook) with a substitute LOC to be issued by Sumitomo Mitsui Banking Corporation (rated 'A-/F1'; Stable Outlook); and (ii) the mandatory tender of the bonds, which will occur on Feb. 3, 2014.

KEY RATING DRIVERS

The rating is based on the support provided by the substitute LOC issued by Sumitomo Mitsui Banking Corporation, acting through its New York branch.

Pursuant to the substitute LOC, the bank is obligated to make regularly scheduled payments of principal of and interest on the bonds in addition to payments due upon maturity and redemption, as well as purchase price for tendered bonds. The rating will expire upon the earliest of: (a) Feb. 3, 2017, the initial stated expiration date of the substitute LOC, unless such date is extended; (b) conversion to a mode other than weekly; (c) any prior termination of the LOC; and (d) defeasance of the bonds. The Sumitomo Mitsui substitute LOC provides full and sufficient coverage of principal plus an amount equal to 57 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 Merrill Lynch, Pierce, Fenner & Smith Incorporated.

RATING SENSITIVITIES

The rating is exclusively tied to the short and long-term rating that Fitch maintains on the bank providing the substitute LOC and will reflect all changes to that rating.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:

--'U.S. Municipal Structured Finance Criteria' (Feb. 27, 2013);

--'Rating Guidelines for Letter of Credit-Supported Bonds' (June 14, 2013.)

Applicable Criteria and Related Research:

U.S. Municipal Structured Finance Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=701570

Rating Guidelines for Letter of Credit-Supported Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=710476

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