Fitch Ratings said it has downgraded the following Dallas County Hospital District, Texas, bonds to AA-plus from AAA: $24.8 million limited tax bonds, tax-exempt series 2009A; $222.5 million limited tax bonds, taxable series 2009B (Build America Bonds - Direct Payment); and $457.7 million limited tax bonds, taxable series 2009C (Build America Bonds - Direct Payment).
The rating outlook is stable.
The bonds are secured by property tax levy limited to $0.75 per $100 taxable assessed valuation (TAV) on all taxable property within the county.
The downgrade reflects Fitch's concerns regarding management and operational uncertainties stemming from a failed federal Center for Medicare and Medicaid Services (CMS) survey in 2011. While Fitch believes the district is likely to pass a subsequent re-survey in 2013, the recent failure, along with the ensuing management turnover, are not consistent with Fitch's highest credit rating.