Moody's Investors Service said it has downgraded to Aa2 from Aa1 the rating on the city of Cincinnati, Ohio's general obligation unlimited tax debt.
Concurrently, Moody's has downgraded to Aa3 from Aa2 the rating on the city's outstanding economic development and non-tax revenue debt and the Convention Facilities Authority of Hamilton County's second lien revenue bonds, Series 2004.
The outlook has also been revised to negative.
The Aa2 rating applies to $520.4 million of outstanding general obligation unlimited tax debt. The Aa3 rating applies to $101.4 million of economic development and non-tax revenue debt and $18.1 million of the Convention Facilities Authority of Hamilton County's second lien revenue bonds, Series 2004 (an additional $11.9 million has been legally defeased).
The city's general obligation debt is secured by the city's general obligation unlimited tax pledge.
The downgrade to Aa2 reflects the city's exposure to two statewide multi-employer cost-sharing pension plans as well as the city's single-employer plan; the city's pressured but still satisfactory financial position, including the recent stabilization of income tax revenues; moderate financial flexibility provided by available but unused levy authority; the city's economically diverse economic base; relatively weak socio-economic indices; above average debt position with significant sources of non-levy support; and the relatively strong funded position of the city's single-employer plan OPEB liabilities.
