Moody's Investors Service has affirmed its Aaa rating on King County, Wash., ahead of its upcoming sale of general obligation bonds backed by an unlimited tax pledge.

The $101 million of refunding bonds are scheduled to be sold the week of July 16.

The rating agency also affirmed King County's limited-tax GOs at Aa1. The county plans to sell $41 million of limited-tax GOs at the same time as the unlimited-tax GOs.

The ratings reflect the county's fundamentally sound economic base emerging from the recession, above-average socio-economic indices and its narrowed, yet satisfactory, financial position and modest debt burden,” Moody's said in a report released Wednesday.

However, Moody's also noted that King County faces challenges in the form of narrow reserves and a shrinking tax base, which are both weak relative to a Aaa rating.

The stable outlook is based on Moody's expectation that the county will continue to manage its financial operations well as it recovers from challenges posed by the recession, the agency said.

King County has more than 1.9 million residents, making it Washington's most populous county.

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