OREANDA-NEWS. Fitch Ratings assigns an 'A' rating to bank bonds associated with the following Nassau County bonds (as guarantor to Nassau Health Care Corporation bonds):

--$37,375,000 Nassau Health Care Corporation Bonds (Nassau County Guaranteed), Series 2009C-1;

--$35,830,000 Nassau Health Care Corporation Bonds (Nassau County Guaranteed), Series 2009C-2.

The series 2009C-1 and 2009C-2 bonds have liquidity support pursuant to a Third Amendment to the Letter of Credit and Reimbursement Agreement dated July 7, 2015 between the Nassau Health Care Corporation (NHCC) and Wells Fargo Bank, National Association.

Based on a review of the terms governing bank bonds specified in the associated agreement it is Fitch's opinion that if the bonds were to convert to bank bond mode, the incremental risk associated with the bank bonds would not have a material impact on Nassau County's (as guarantor) long-term credit rating.

SECURITY

The NHCC bonds carry Nassau County's faith and credit and taxing power, subject to a 2011 state statute limiting property tax increases to the lesser of 2% or an inflation factor (tax cap law). This limit can be overridden annually by a 60% vote of the county legislature.

KEY RATING DRIVERS

LIMITED FINANCIAL FLEXIBILITY: The primary driver of the 'A' rating is Fitch's expectation that the county's financial flexibility will remain limited, evidenced by weak reserves and a high dependence on economically sensitive sales tax revenues.

SHORT-TERM MARKET RELIANCE; SOUND COVERAGE: Low liquidity and the county's reliance on short-term market access for note repayment and operations is a key concern. However, note coverage is strong, note par has declined slightly over the last few years, and the county continues to have strong market access.

STRONG ECONOMIC FUNDAMENTALS: The county maintains a diverse economy and tax base, and has a population with high income levels.

MANAGEABLE LONG-TERM LIABILITIES: The sizable and wealthy tax base supports a manageable debt burden with above-average amortization. Capital needs are moderate and state pension plans are well funded.

IMPROVED RELATIONSHIP WITH NIFA: An improved working relationship with the Nassau County Interim Finance Authority (NIFA) has led to the negotiation, approval and implementation of several important revenue enhancing and expenditure reduction initiatives. NIFA's power as an oversight board remains a credit positive, providing some limits to downside risk.

RATING SENSITIVITIES

PROGRESS TOWARD DEFICIT REDUCTION: The 'A' rating and Stable Outlook incorporate Fitch's expectation that Nassau County will resume modest progress in sustainable deficit reduction to maintain a stable, albeit tightly balanced, financial profile. The rating is sensitive to a shift in these fundamentals.

For more information on Nassau County's long-term credit rating, see 'Fitch Rates Nassau County, NY's GO Bonds 'A', BANs and RANs 'F-1'' dated May 12, 2015, available on Fitch's website at www.fitchratings.com.