Fitch Ratings recently downgraded several Riverside County bonds and certificates.
General obligation bonds were dropped to AA-minus from AA, pension obligation bonds were dropped to AA-minus from A-plus, and Riverside County Asset Leasing Corp. certificates of participation and lease revenue bonds were dropped to AA-minus from A-plus.
The Riverside County Palm Desert Financing Authority and the Southwest Communities Financing Authority also had their lease revenue bonds dropped to AA-minus from A-plus.
After the downgrades, the county’s outlook was revised to stable from negative.
Fitch attributed the downgrade of the implied GO rating to management’s projection that the previously expected operational balance will not be achieved, an expectation that fund balances will decline to just adequate levels, and revenue pressures from lingering economic softness.
Analysts also cited the area’s high unemployment rate of 15.1%, further predicted job losses, and a 5% decrease in home prices for the rating, but credited the county with overall good management practices.
The cumulative drop in home prices in Riverside County over a three-period is 14.6%.