Standard & Poor's Ratings Services said it raised its issuer credit rating on Big Rapids Public Schools, Mich.'s outstanding general obligation debt to A from A-minus.
The outlook is stable.
The upgrade reflects the district's improved financial position due to consistent financial performance in recent years, coupled with projections of positive financial results in fiscal years 2013 and 2014. It further reflects the district's projections for stable enrollment.
At the same time, the rating agency affirmed its AA-minus program rating on the district's GO debt, reflecting the bonds' qualification under the Michigan State School Bond Loan Fund program. The outlook is positive.
"The ICR reflects our opinion of the district's stable local economy anchored by Ferris State University (FSU), projected enrollment stabilization, and conservative budgeting practices," said Standard & Poor's credit analyst Caroline West. Other factors include its low overall net burden.
Partly offsetting the above credit strengths is the district's below-average incomes and wealth.
The district's unlimited-tax GO pledge secures the bonds.
The district is 57 miles north of Grand Rapids in Mecosta County and serves a population of 19,000. It includes the city of Big Rapids, home to FSU (with over 14,500 students enrolled) that acts as an anchor to the city's economy.
The positive outlook on the program rating reflects the outlook on the Michigan GO debt rating.
"The stable outlook on the ICR reflects our view that the management will maintain its operations to improve its reserves to meet its goal of 10% of expenses," added West.
