Moody’s Investors Service has downgraded Davenport, Iowa’s general obligation bond rating one notch to Aa2 ahead of its sale of $31.3 million of new debt.

The action affects a total of $208 million of debt. Analysts attributed the downgrade to the city’s five years of declining general-fund reserve levels and limited liquidity across the city’s enterprise funds.

The rating reflects Davenport’s large tax base supported by its role as the regional economic center for the Quad Cities area, average socioeconomic indexes and elevated debt position.

Proceeds of the sale will fund various capital improvements.

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