Moody's Investors Service has downgraded to A3 from A2 the outstanding rating on the city of Jasper, Texas's general obligation limited tax debt.
Concurrently, Moody's assigned an A3 underlying rating to the city's $4.4 million combination tax and revenue certificates of obligation Series 2012. The A3 rating affects approximately $11.4 million in Moody's rated debt.
The proceeds of the current sale will fund various improvements and renovations within the city.
The certificates constitute direct obligations of the city and are payable as to principal and interest from a combination of an ad valorem tax levied annual, within the limits prescribed by law, against all taxable property within the city and surplus revenues, if any, received by the city from the ownership and operation of the city's municipal water works and sanitary sewer system.
The downgrade and A3 rating assignment reflects the city's narrow financial position, the limited and concentrated tax base, below average socio-economic indicators, and an above average debt burden.
The A3 rating also incorporates the city's projections for modest surpluses with improvements that will result in estimated reserves below historic levels for the city and similarly rated cities in the state and nation.