Moody's Investors Service said it has downgraded to Aa3 from Aa2 the underlying general obligation rating of Jefferson School District, Wis.
Concurrently, Moody's has assigned a Aa3 rating to the district's $4.8 million taxable general obligation refunding bonds. The Aa3 rating applies to $40.9 million of post-sale general obligation debt outstanding.
The bonds are secured by the district's general obligation unlimited tax pledge. Proceeds of the bonds will advance refund portions of the district's outstanding general obligation refunding bonds, Series 2005, and taxable general obligation refunding bonds, Series 2005.
Approximately $2.6 million of the current financing is payable outside the revenue limit, while approximately $1.8 million is payable inside the state imposed revenue limit.
The downgrade to Aa3 from Aa2 reflects primarily a third consecutive year of tax base decline for the district in 2012 to a size more consistent with the Aa3 rating.
The Aa3 rating also reflects the district's favorable location within commuting distance of both the Madison (GO rated Aaa/stable outlook) and Milwaukee (GO rated Aa2/stable outlook) metropolitan areas; average residential income indices; stable financial operations with satisfactory reserve levels; and above average debt burden that is expected to remain manageable.
