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���������ֳ�-New York-10 May 2016: ���������ֳ� has assigned a rating of 'F1+' on the following tax anticipation notes (TANs) to be issued by Fulton County:

--$150 million general fund TANs, due Dec. 30, 2016.

Proceeds of the 2016 TANs will fund certain current expenses to be incurred by the county during calendar year 2016 prior to the collection of ad valorem taxes levied for the general fund. The TANs are expected to be offered via competitive sale on or about May 18.

���������ֳ� has also affirmed the following ratings:
--Long-Term Issuer Default Rating (IDR) at 'AA';
--General obligation (GO) library bonds, series 2010A and (taxable Build America Bonds), series 2010B at 'AA';
--Certificates of participation (COPs), series 2009 issued by the Fulton County Facilities Corporation at 'AA-'.

SECURITY
The TANs are general obligations of the county payable from revenue received by the county during calendar year 2016 as well as other available funds. The GO library bonds are a general obligation of the county backed by the levy of ad valorem taxes without limitation as to rate or amount. COPs issued by the Fulton County Facilities Corporation are payable from rental payments made by the county, subject to annual appropriation.

KEY RATING DRIVERS

Analytical Conclusion: Fulton County's 'AA' IDR and ULTGO ratings reflect its history of maintaining an adequate financial cushion despite volatile revenues and uneven operating results, superior levels of inherent budgetary flexibility reflecting an unlimited legal ability to raise revenue and moderate fixed-cost burden, and a very low long-term liability burden. Underpinning ���������ֳ�'s assessment of the county's key rating factors is its participation in the large, diverse, and expanding Atlanta area economy. The
'AA-' COPs rating is notched down from the IDR reflecting the slightly higher degree of optionality associated with appropriation payments compared to the IDR. The 'F1+' rating assigned to the TANs corresponds to the county's IDR.

Economic Resource Base: Fulton County is located at the center of the Atlanta-Sandy Springs-Roswell, GA Metropolitan Statistical Area (MSA), the ninth largest MSA in the U.S. measured by population and employment. The area economy is very diverse and particularly well represented by the professional and business services sector and trade and transportation, leveraging the resources of a well-trained and educated workforce and vast network of transportation assets anchored by the Hartsfield-Jackson International Airport. The MSA is one of the fastest growing in the U.S., fueling a large construction and housing industry which has also been a point of vulnerability in prior periods of economic decline.

Revenue Framework: 'aa' factor assessment
Historical growth of general fund revenues has lagged that of the U.S. economy and inflation, reflecting periods of contraction in the county tax digest and property tax revenue, the dominant funding source for general fund operations, as well as policy action. ���������ֳ� expects continued slow growth in the county's revenues. The county has unlimited legal control over the ability to increase its property tax rate and levy, underpinning a strong capacity to manage fiscal challenges.

Expenditure Framework: 'aa' factor assessment
���������ֳ� expects general fund spending, in the absence of policy action, will continue to marginally outpace revenues, on average, over time given the demands placed on county services by a growing population. Tempering this risk is the fact that carrying costs related to long-term debt and retiree benefit liabilities are expected to remain moderate. A very flexible labor environment that provides the county full control over employee wages, benefits and work rules is another positive consideration.

Long-Term Liability Burden: 'aaa' factor assessment
Fulton County debt and pension liabilities measure a very low 2.1% of personal income and are expected to remain stable reflecting expectations for potential moderate additional borrowing and the closed status of the county's single-employer defined benefit pension plan.

Operating Performance: 'aa' factor assessment
Expenditure reduction measures have played a central role in the county's ability to address its comparatively volatile revenue performance and maintain an adequate level of financial reserves during economic downturns. A recent tax rate increase and strengthened financial policies signify management's commitment to keeping the county in a steady operating state going forward.

RATING SENSITIVITIES
Improved Revenue Stability: A continued high level of revenue volatility is presently assumed; the prolonged moderation of this risk could lead to the consideration of an upgrade.

Weakened Financial Performance: Consideration of a downgrade may result from a shift in the county's fiscal management practices that result in expectations for a diminished financial cushion to address future economic downturns and unexpected events.

Long-term Rating: Short-term debt ratings are related to those of long-term obligations; a lowering of the county's IDR rating below 'AA-', though not presently anticipated, could result in a downgrade in the TAN rating.

Revenue Framework
Property taxes are the dominant funding source for the county representing roughly 80% of budgeted fiscal 2016 general fund revenue (local option sales taxes are the second largest source at 6%). Property taxes are not due until October 15 each year; therefore, the county routinely issues TANs to provide cash for operations for a portion of its fiscal year which begins on January 1.

Fulton County's general fund revenues have increased at a tepid long-term pace despite a general pattern of growth in population and the economy. One factor weighing against revenue growth has been the volatile nature of the housing market; home prices in the county fell about 35% from November 2007 through December 2011, according to Zillow Group. The county enacted a series of increases in the homestead exemption during this period, as mandated by state law, which exacerbated the influence of the housing downturn on revenue. New construction helped absorb some of the decline from the housing downturn as the drop off in the county's tax digest was less pronounced than the change in housing, but still notable. The annual general fund tax levy declined more than 18% or $85.4 million between fiscal years 2009-2012, contributing to several years of large fund balance deficits.

Home prices have since rebounded close to pre-recession peaks and are forecast by Zillow Group to increase another 5% in the next year. The recovery of the county's tax digest enabled it to roll back the bulk of a 15% tax increase adopted in 2014 that helped stabilize its finances and rebuild reserves. The adopted 2016 budget includes a tax rate of 10.75 mills (10.5 mills for operations and 0.25 for debt service), which is considered by ���������ֳ� to be competitive for the surrounding area. ���������ֳ� expects home prices (and general fund revenue) will likely remain subject to periods of adjustment going forward absent policy action by the county.

The county has very broad legal revenue-raising authority, as it is not subject to a cap on its millage rate or tax levy or requirements for voter approval as a condition precedent to a change in either.

There is legislation pending in the Georgia Assembly that would allow residents of the South Fulton special district to vote on incorporation. County management indicated the general fund would lose approximately $20 million in annual local option sales tax revenue (3.2% of 2016 GF budgeted revenue) offset by corresponding expenditure savings of $13 million. A transition period would likely follow a successful vote on incorporation providing the county time to formulate a plan to address resultant budgetary challenges.

Expenditure Framework
General fund expenditures are largely driven by the operation of the county sheriff's office and detention center, the justice and court system, public health services, libraries, and other governmental services. Additional services are provided by the county to unincorporated areas but recorded outside of the general fund. The county also provides financial support to various governmental authorities, most notably, the Fulton-DeKalb Hospital Authority, which oversees operations at Grady Memorial Hospital.

Spending levels are expected to track changes in population and inflation and marginally outpace revenue growth over time in the absence of policy actions.

Within various departmental budgets employee wages and benefits are the largest contributors to operating spending. The terms of employee wages, benefits, and work rules are established by the county and not collective bargaining, resulting in a high relative ability to control labor costs over time.

���������ֳ� estimates a moderate 18% of the county's general fund budget to be associated with fixed costs related to debt service, pension benefits, and actual other-post employment benefit (OPEB) contributions. Scheduled annual debt service costs decline by more than $20 million over the next four years or the equivalent of 3% of budgeted general fund spending in 2016, enhancing overall budget flexibility and/or providing additional capacity for the incurrence of debt. The pension component of the county's fixed cost burden should remain relatively stable absent actuarial changes, as the Fulton County Employees' Retirement System (FCERS), a single-employer defined benefit pension plan, was closed to new participants in 1999 in place of a new defined contribution plan.

A total of $60.2 million or 9% of the adopted 2016 general fund budget is dedicated to Grady Hospital. The funding commitment includes $17.7 million in debt service on bonds sold by the Fulton-DeKalb Hospital Authority. The debt service on the bonds is an absolute and unconditional obligation of the county backed by the levy of a limited ad valorem tax, and included in ���������ֳ�'s fixed burden analysis. The level of operating assistance provided to Grady is not mandated by law but established by the county on an annual basis.

Long-Term Liability Burden
The county's long-term liability burden is a very low 2% of personal income and is expected to remain well within the 10% threshold consistent with an 'aaa' assessment. Direct county debt and the ���������ֳ�-adjusted net pension liability (NPL) associated with the FCERS each account for 35%-40% of the total liability metric, with the remainder derived from the debt of overlapping jurisdictions. The FCERS NPL should show gradual improvement given the plans' closed status and the county's practice of fully funding the actuarially determined contribution (ADC) on an annual basis.

The county has $108.4 million in authorized unissued GO library bonds (equivalent to only 8% of the county's total long-term liability burden) which it does not plan to sell until 2017 at the earliest. The county does not prepare a formal planning document outlining future capital needs and funding sources but recently hired an independent consultant to prepare a facilities assessment report. The report is not yet completed but preliminary findings communicated by county management indicate up to $150 million in projects associated with a new justice center and central government complex.

���������ֳ� estimates the long-term liability burden would increase by close to 15% following a successful South Fulton incorporation as the county's total personal income is reduced by the loss of 80,000-120,000 residents. The new city would remain liable for its share of debt service on voted GO bonds, which make up only 11% of the total liability burden and 20% of annual debt service charges.

Operating Performance
The three-year scenario revenue estimate generated by ���������ֳ�'s analytical sensitivity tool (FAST) depicts a relatively high level of volatility in the absence of offsetting policy action. ���������ֳ� expects that the county would maintain a reserve cushion commensurate with a 'aa' financial resilience assessment throughout a moderate economic decline scenario. The financial resilience assessment is informed by ���������ֳ�'s view of the county's superior budgetary flexibility and capacity to respond to any such downturns, primarily evidenced through its broad legal revenue raising powers and ability to control key spending areas. The county has a long history of maintaining reserves above the 'aa' reserve safety margin (8.4%) and an adopted fiscal policy requiring a minimum two months of general fund appropriations.

The county has demonstrated consistent efforts to rebuild reserves and financial flexibility following a period of fund balance draws from fiscal years 2011-2013. Most significant, the county approved a 15% increase in its real property tax rate in fiscal 2014 contributing to an operating surplus after transfers equal to $36.8 million or 6.4% of spending in fiscal 2014. The operating surplus increased the unrestricted fund balance to a healthy $120.6 million or 21.0% of spending. Unaudited results for fiscal 2015 depict an additional increase in the general fund balance of $28.3 million on a cash basis.

The adopted 2016 budget does not appear to include any material deferral of spending or liabilities. The budget projects the use of $51.9 million in reserves compared to the budgeted spend down of $17.6 million in fiscal 2015. The increase in the anticipated fund balance use reflects higher debt service costs ($8.4 million), an increase in salaries due to implementation of a new pay and compensation plan ($12.9 million), election year administration and operation expenses ($6 million), and new investments for IT capital ($6 million) and road improvements ($5 million). The county routinely underspends its budget largely through conservative forecasting and management of personnel costs as such the year-end change in fund balance is not expected to be as significant as forecasted.


Contact:

Primary Analyst
Michael Rinaldi
Senior Director
+1-212-908-0833
���������ֳ�, Inc.
33 Whitehall Street
New York, NY 10004

Secondary Analyst
Grace Wong
Director
+1-212-908-0652

Committee Chairperson
Laura Porter
Managing Director
+1-212-908-0575



Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: elizabeth.fogerty@fitchratings.com.

Additional information is available at ''.

In addition to the sources of information identified in the applicable criteria specified below, this action was informed by information from Lumesis and InvestorTools.

Applicable Criteria
U.S. Tax-Supported Rating Criteria (pub. 18 Apr 2016)

Additional Disclosures
Dodd-Frank Rating Information Disclosure Form
Solicitation Status
Endorsement Policy