Standard & Poor's Ratings Services said it lowered its long-term rating to D from CC on Boynton Beach, Fla.'s series 2012A tax-exempt and 2012B taxable revenue bonds, issued for and supported by the Charter School of Boynton Beach.
"The downgrade reflects the school's missed payments on its bonds due June 1, 2015," said Standard & Poor's credit analyst Carolyn McLean. The fully funded debt service reserve fund funded previous payments as well as legal fees and other fees associated with the closure of the school.
The charter authorizer, the School District of Palm Beach, voted unanimously to revoke the school's charter on July 30, 2014. The charter revocation is based on Florida State statute that requires the sponsor to terminate a school's charter if the school receives a grade of F for two consecutive years and has been in operation for more than five years.
The Charter School of Boynton Beach had a score of F for the 2012-2013 and 2013-2014 school years. Standard & Poor's expected the bonds would likely default within the 24 months of closure given that the charter school no longer had access to operating revenue once the charter was revoked.
