Moody's Investors Service said it has downgraded to A2 from A1 the rating on the village of Calumet Park, Ill.'s outstanding general obligation bonds.
Concurrently, it assigned a A2 rating to the village's $1.5 million general obligation refunding bonds, Series 2014A and $4.4 million general obligation bonds, Series 2014B.
Post-sale, the village will have $15.8 million of general obligation debt outstanding, of which $11.4 million is rated by Moody's.
The bonds are secured by the village's general obligation unlimited property tax pledge, which is unlimited as to rate and amount.
The Series 2014A bond proceeds will refund the callable portion of the village's outstanding Series 2003 general obligation tax increment bonds for estimated net present value savings of 5%. Proceeds from the Series 2014B bonds will finance the costs related to the construction of a 911 call center.
The A2 rating is based on ongoing declines in the village's tax base value, yielding a reduction of over 25% in valuation since 2010 and continued general fund support for certain enterprise operations.
The rating also reflects the village's substantial debt burden as a percent of full value, solid financial operations with strong reserves, and somewhat elevated but manageable pension liabilities. The A2 rating incorporates the financial flexibility afforded by the village's designation as a home rule unit of government.
