Standard & Poor's Ratings Services said it lowered its underlying rating on Lyons Village, Ill.'s series 2009A general obligation limited-tax bonds to A-minus from A.
At the same time, Standard & Poor's lowered its SPUR on the village's series 2009B GO limited tax debt certificates series to BBB-plus from A-minus.
In addition, Standard & Poor's assigned its A-minus rating to the district's series 2014A and 2014B GO alternate revenue source bonds. Standard & Poor's also assigned its BBB-plus rating to the village's series 2014 limited tax debt certificates. The outlook on all ratings is stable.
"The ratings are being lowered due to the village's low nominal fund balance and weak budgetary performance," said Standard & Poor's credit analyst David Smith.
The village's debt and contingent liability profile is very weak, S&P said. In 2013, total governmental fund debt service was 19% of total governmental fund expenditures, after adjustments, and net direct debt was 199% of total governmental fund revenue.
Amortization of the city debt is fairly rapid, with 66% of the village's debt retired within 10 years. The obligor has had exposure to interest rate risk through provisions of alternative financings but is refunding this debt with these current issues.
