Bangkok--17 Feb--Standard & Poor's
Standard & Poor's Ratings Services said today that it raised various debt ratings on 19 school districts in California and one in Washington. At the same time, Standard & Poor's revised an outlook to stable from positive and affirmed a debt rating on one California school district, affirmed a debt rating on another California school district, and affirmed a debt rating on a Colorado school district. In all cases, the resulting outlook is stable. For complete information, see "Strong Financials Support Western U.S. School District Upgrades, But State Aid Cuts Are Likely," published today on RatingsDirect.
"The upgrades were part of our practice of regularly surveilling existing ratings, and they reflect criteria we published in 2008 on the role of size, location, and quantitative factors in our opinions on general obligation and appropriation debt," said Standard & Poor's credit analyst Chris Morgan.
The maintenance of at least strong reserves was a factor in most of the upgrades, although many districts are subject to revenue pressure from intensifying state budgetary stress that has translated into funding reductions or delays in some cases.
As school districts in many western states contend with lower state contributions because of tight state budgets, we believe that the way they respond to budget challenges will represent a key influence on credit quality. Should economic recovery be slow, as many state economists project, school districts will be unlikely to see a return to significant growth in state aid and could see further cuts on a per student basis. The positive ratings actions we've taken on California and Washington school districts reflect our view that these districts have so far met the challenge of a weaker funding environment. We will continue our surveillance and take appropriate rating actions as necessary.
The California school districts that saw upgrades are Coronado Unified, Eastern Sierra Unified, Hanford Elementary, Jamul-Dulzura Union, Kings River Union Elementary, Lakeside Joint (Santa Clara County), Linns Valley-Poso Flat Union, Lucerne Valley Unified, Mammoth Unified, Newark Unified, Nicasio Elementary, Oakley Union Elementary, Orcutt Union, Paradise Unified, Pioneer Union Elementary, Rio Elementary, Sanger Unified, Tamalpais Union High, and Weaver Union. The California school district that saw an outlook revision to stable from positive and its debt rating affirmed is West Sonoma County Union High. The California district that saw its debt rating affirmed is Gustine Unified. The Colorado school district that saw its debt rating affirmed is Adams County No. 1 (Mapleton). The Washington school district that saw an upgrade was Cowlitz County No. 401 (Castle Rock).
RELATED RESEARCH
USPF Criteria: GO Debt, Oct. 12, 2006
USPF Criteria: Key General Obligation Ratio Credit Ranges — Analysis Vs. Reality, April 2, 2008
USPF Criteria: Does Bigger Always Mean Better? Sizing Up The Impact Of Size On Municipal Ratings, April 22, 2008
USPF Criteria: Location, Location, Location: What Does It Mean For My Community's Rating?, April 22, 2008
USPF Criteria: Appropriation-Backed Obligations, June 13, 2007
California; Appropriations; General Obligation; General Obligation Equivalent Security; Note; School State Program, Jan. 15, 2010
Colorado; Appropriations; General Obligation, Jan. 27, 2010
Washington; General Obligation, Jan. 7, 2010
The report is available to RatingsDirect on the Global Credit Portal subscribers at www.globalcreditportal.com and RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-7280 or sending an e-mail to
[email protected]. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.
Media Contact:
Ana Sandoval, New York (1) 212-438-5095,
[email protected]
Analyst Contacts:
Chris Morgan, San Francisco (1) 415-371-5032
Gabriel Petek, CFA, San Francisco (1) 415-371-5042
Matthew Reining, San Francisco (1) 415-371-5044
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_
[email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]