Moody's Investors Service said it has downgraded to Aa3 from Aa2 the general obligation rating of East Lansing City School District, Mich.
The district has $58.4 million of GO debt, of which $51 million is rated by Moody's. Concurrently, Moody's removed the district's negative outlook. The district's GO bonds are secured by an unlimited tax pledge as authorized by voters.
The Aa3 rating reflects the district's limited though adequate general fund reserves. The Aa3 rating further incorporates the district's sizable tax base and above average debt burden. Removal of the negative outlook is based on the district's stable enrollment trend, which factors favorably into the state aid formula, as well the expectation that the district's finances will stabilize based on ongoing expenditure reductions.