Moody's Investors Service said it has downgraded Buffalo Independent School District, Texas's general obligation unlimited tax bonds to A2 from A1, affecting $18 million in debt.

The bonds are secured by a continuing direct annual ad valorem tax levied, without legal limit as to rate or amount, against all taxable property located within the district.

The downgrade to A2 from A1 reflects the district's four consecutive years of declines in taxable values, concentrated local economy, and high debt burden. The downgrade also takes into account the district's history of conservative financial management which has led to healthy financial reserves.

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