Tustin USD Upgraded Ahead of Bond Sale

school2-fotolia.jpg

SAN FRANCISCO — Moody's Investors Service upgraded the rating on Tustin Unified School District to Aa1 from Aa2 ahead of a $45 million general obligation bond sale next week.

Tustin USD, located in Orange County, Calif., services the city of Tustin, portions of North Tustin, portions of the city of Irvine, and portions of the city of Santa Ana.

The district includes 18 elementary schools, five middle schools, four high schools, one K-8 school, and one adult school.

"The upgrade reflects the district's very strong financial position supported by nine operating surpluses over the past decade, which has resulted in large operating reserves that we expect will be maintained at above-average levels," analysts said in the Dec. 5 report.

They added that the upgrade also reflects the large tax base that Moody's expects will undergo moderate growth and the district's strong management team.

Other credit strengths include the district's sizable tax base, above average wealth levels, healthy financial position, and management's prudent fiscal practices.

Challenges include growing pension and other post-employment costs and an above average overall debt burden.

The upgrade applies to the district's $45 million of GO bonds, expected to be sold Dec. 18.

The deal includes $20 million of school facilities improvement district bonds, and $25 million of refunding school facilities improvement bonds.

Proceeds will finance the construction of new facilities, and the renovation and improvement of existing schools, and advance refund a portion of outstanding debt.

For reprint and licensing requests for this article, click here.
California
MORE FROM BOND BUYER