CHICAGO - Moody's Investors Service placed Steele County, Minn.'s ratings on review for a possible downgrade as several enterprise fund commitments strain the county's books.
The action on March 17 impacts $15 million in rated debt. On review are the county's Aa2 general obligation rating on $11.8 million of debt and the A2 rating on its $3.2 million of health care revenue bonds from a 2005 issue.
The rating review follows a March 6 notice that Steele County Communities For a Lifetime Inc. will be unable to make a scheduled monthly debt payment; Moody's cites contingency risk and imbalanced operations of the nonprofit, jointly owned by the county and Benedictine Health System.
The bonds were issued through a separate municipality.
The county faces another strain as it continues to advance money to its Civic Center Enterprise Fund for cash flow purposes related to ice rink operations that have not been self supporting to date.
"While general fund liquidity currently remains healthy, continued support of the county's enterprise funds could pressure the overall financial profile," Moody's wrote. "Resolution of the review will rely upon fiscal 2014 estimated results, forward-looking financial and operating information provided by the county and SCCL, and long-term strategies for the management of underperforming enterprises."
