Moody's Investors Service said it has downgraded to A3 from A2 the rating on Harris County Municipal Utility District 150, Texas' general obligation bonds affecting $17.2 million.

Annual principal and interest payments are secured by the proceeds of a continuing and direct annual ad valorem tax, without legal limitation as to rate or amount, levied against all taxable property within the district.

The downgrade to A3 is driven by significant declines in tax base. The district experienced four consecutive periods of decline, losing approximately 26% of their tax base between 2010 and 2013. Additional considerations include an elevated debt burden, slow debt payout, as well as modest growth in general fund and cash reserves.

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