Standard & Poor's Ratings Services said it lowered its rating on Dyersburg, Tenn.'s outstanding general obligation (GO) debt one notch to A from A-plus based on the trend of budgetary imbalances that have led to a significant reduction in the city's available general fund reserves.
The outlook is stable.
At the same time, Standard & Poor's assigned its A rating and stable outlook to the city's series 2013 GO school bonds.
"The A rating reflects Standard & Poor's opinion that the city will maintain adequate finances, supported by the recent property tax rate increase," said Standard & Poor's credit analyst Jim Tchou. "We expect economic improvement to remain slow and modest during the recovery period."
The rating reflects the city's: role as a regional economic center, reflected by adequate income levels and very strong market value per capita; high unemployment; moderately concentrated property tax base; adequate finances; and moderate overall debt burden, coupled with low carrying changes and rapid debt amortization.
Dyersburg's full faith and credit pledge and unlimited ad valorem property tax pledge secure the bonds. Management will use the bond proceeds mainly to improve and renovate school facilities.
Dyersburg, with a population estimate of 17,043, is in northwestern Tennessee, about 78 miles north of Memphis and 45 miles northwest of Jackson.