New York, November 08, 2012 --

Moody's Rating

Issue: Combination Tax and Revenue Certificates of Obligation, Series 2012A; Rating: Aa1; Sale Amount: $6,260,000; Expected Sale Date: 11-13-2012; Rating Description: General Obligation

Issue: Combination Tax and Revenue Certificates of Obligation, Series 2012B; Rating: Aa1; Sale Amount: $2,790,000; Expected Sale Date: 11-13-2012; Rating Description: General Obligation

Opinion

Moody's Investors Service has assigned a Aa1 underlying rating and stable outlook to the City of Amarillo's (TX) $6.26 million Combination Tax and Revenue Certificates of Obligation, Series 2012A and $2.79 million Combination Tax and Revenue Certificates of Obligation, Series 2012B. We also affirm the Aa1 rating and assigns a stable outlook to $49.7 million in outstanding parity debt previously issued by the city. The ratings take into consideration roughly $99.5 million in outstanding parity debt not rated by Moody's. Proceeds from the sale of Series 2012A Certificates will fund acquiring, improving, and constructing municipal drainage facilities, including the purchase of land, rights-of-way, and associated equipment. Proceeds from the sale of Series 2012B Certificates will fund acquiring rolling stock, equipment and vehicles for the municipal garage department.

SUMMARY RATING RATIONALE

The Series 2012A Certificates are payable from a combination of the levy and collection of a direct and continuing ad valorem tax levied on all taxable property within the city, within the limits prescribed by law as well as a pledge of the net revenues of the city's drainage utility system. The Series 2012B Certificates are payable from a combination of the levy and collection of a direct and continuing ad valorem tax levied on all taxable property within the city, within the limits prescribed by law as well as a limited pledge (not to exceed $1,000) of the net revenues of the city's municipal solid waste disposal fees. The rating of Aa1 reflects the city's large stable tax base, solid financial performance with stable healthy reserves, and a modest debt burden when incorporating support from the city's water and sewer system revenues. The stable outlook reflects our belief that solid financial performance and healthy reserve levels will be maintained in the near-term which is the result of historically strong financial management.

STRENGTHS

* Large stable tax base

* Stable financial operations with healthy reserves

* Manageable debt burden

* Historically sound financial management practices

CHALLENGES

* Relatively weak socioeconomic profile

STABLE OUTLOOK

The stable outlook reflects our belief that solid financial performance and healthy reserve levels will be maintained in the near-term which is the result of historically strong financial management.

WHAT COULD MAKE THE RATING GO UP:

* Improved socioeconomic profile

* Substantial tax base growth

* Maintenance of solid financial performance and healthy reserves

WHAT COULD MAKE THE RATING GO DOWN:

* Deterioration of General Fund reserves

* Significant contraction of taxable value

RATING METHODOLOGY

The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

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