Moody's Investors Service said it has downgraded to Aa3 from Aa2 the rating on Clarkston Community Schools, Mich.'s general obligation debt.

Moody's also assigns Aa3 underlying rating and Aa2 enhanced rating with stable outlook to the district's $35.2 million refunding bonds, 2012 (GOULT). The Aa3 rating affects approximately $160.8 million of outstanding debt secured by the district's general obligation unlimited tax pledge.

The 2012 bonds are secured by the district's general obligation unlimited tax pledge. The Aa3 underlying rating reflects the district's sizable tax-base located in Oakland County (GO rated Aaa/stable), satisfactory financial operations with declining reserve levels, stable enrollment, and high debt burden.

The Aa2 enhanced rating with stable outlook is due to the additional security provided by the State of Michigan's School Bond Qualification and Loan Program. The Michigan Department of Treasury is expected to grant final qualification status to the district's bonds following the sale.

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