Moody's Investors Service said it has downgraded to A1 from Aa3 the city of Kalamazoo, Mich.'s lease revenue debt, with rental payments that are secured by the city's general obligation limited tax (GOLT) pledge.
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The downgrade to A1 reflects a recent increase in the city's debt burden and somewhat limited reserve levels.
The A1 rating also reflects the city's sizeable tax base, weak socioeconomic indicators, and strong management with recent history of enacting expenditure cuts.
The A1 rating also incorporates the constitutional and statutory limitations on the operating revenues available to pay debt service.
