Moody’s Investors Service downgraded Inglewood, Calif.’s implied general obligation long-term issuer rating to A2 from A1, and the city’s 2005 pension obligation bonds to A3 from A2.
The action primarily incorporates the consistent weakening of the city’s financial position and declining tax base.
In addition, the rating reflects the fact that the moderately sized $6.6 billion tax base located in Los Angeles County — which is Aa2 and stable, and 13 miles southwest of the city of Los Angeles, which is Aa3 and stable — remains challenged.
The rating also factors in the city’s moderate but manageable debt burden of 1.2%, which is expected to decline given the absence of future debt plans, and an amortization of principal — 35.8% within 10 years — that is slow relative to the payout of a comparable California city.
All of the city’s debt is fixed rate and the city is not party to any derivative agreements.