Moody's Investors Service on Tuesday withdrew the tax allocation bond ratings on four successor agencies to California's dissolved redevelopment agencies affecting $71.8 million in debt.
The move by the ratings agency follows a Feb. 28 report by Moody's analysts saying if successor agencies did not provide what it deemed to be necessary information in the post-RDA dissolution world it would no longer rate them.
Citing insufficient information, Moody's analysts withdrew the ratings Tuesday on the following successor agencies: Healdsburg Community Redevelopment Agency, La Palma Community Development Commission, Orange County Development Agency, and Sonoma Community Development Agency.
"These agencies have not provided the necessary, supplemental information we requested in our Feb. 28 report," analysts said.
That report discussed the additional information Moody's would require in order for RDAs to maintain a tax allocation bond rating in the new legal environment governing "successor" redevelopment agencies, and the distribution of tax increment revenues.
Last month, Moody's withdrew ratings on $1.2 billion of debt issued by 22 former California redevelopment agencies, citing a lack of information.
"On June 5, we extended the review period for 68 of the agencies that indicated they intended to provide the additional information, and we withdrew the ratings of 22 others," analysts said in the report. "Since June, we have withdrawn the ratings of three additional RDA issuers for insufficient information. After today's action, 61 issuers' TAB ratings will remain under review, and their ratings will be evaluated in the coming weeks."
The rating agency also downgraded in June 2012 all California redevelopment agencies' tax allocation bonds rated Baa3 or higher to Ba1 and placed all rated RDAs under review for possible downgrade or withdrawal.
The firm said the mass downgrade was due to the much higher risk of default due to the state shutdown of the RDAs, and the review was a result of the possible risks resulting from the new law governing the "successor" agencies that took over responsibility for the debt.
Legislation dissolved the redevelopment agencies in 2012.
