NEW YORK - Moody's Investors Service said it has downgraded Clark County School District, Nev.’s general obligation limited tax rating to Aa3 from Aa2.
$3.0 billion in outstanding GOLT long-term debt, $797.5 million in GOLT/Revenue debt, and $27.3 million in GOLT medium term debt are affected. A stable outlook has also been assigned.
The downgrade reflects the district's weakened financial position relative to large school districts nationwide, including ongoing operational imbalance, thin coverage of limited tax debt service from property tax levies, and declining enrollment limiting district operational flexibility.
The rating also reflects the district's favorable long-term credit characteristics including a substantial tax base, moderate debt burden, rapid amortization of principal, and sizable but declining debt service reserves.
The stable outlook reflects the expectation that the district's financial position will remain challenged as officials manage an era of limited operating flexibility.
Moody's anticipates benefits from improvements in state aid and some sales taxes will be offset in the medium-term by depressed tax base values and continued weakness in non-tourist industries, especially residential construction.