S&P Lifts Shelby Schools

Standard & Poor’s this week raised its underlying issuer credit rating to A from A-minus on the Shelby Public Schools District’s general obligation debt, citing the system’s strong finances and management team. The upgrade applies to about $10 million of outstanding debt.

The agency also assigned a AA-minus long-term rating to the school’s upcoming $9.2 million unlimited-tax GO refunding bond issue, based in part on the district’s participation in the Michigan State School Bond Loan Fund program.

The A issuer credit rating reflects the district’s strong financial position as well as management’s willingness to cut spending to address declining enrollment, analysts said. The system recently laid off teachers and staff and closed an elementary school to reduce expenditures. Management expects it will break even in fiscal 2009, according to Standard & Poor’s.

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