Moody's Investors Service said it has downgraded to Baa1 from A3, Madison and Fremont Counties Joint School District 322 (Sugar-Salem), Idaho's underlying general obligation debt rating (Idaho State Bond Guaranty and Credit Enhancement Programs), affecting $4.3 million in rated debt.
Concurrently, a negative outlook has been assigned.
Moody's maintains a Aaa enhanced rating on the district's rated general obligation debt provided by a guarantee of the Idaho School Bond Guaranty Program.
The downgrade primarily reflects the district's very narrow general fund reserves, economic concentration, and below average socio-economic indicators.
The rating also incorporates the district's modest debt profile with rapid amortization and the recent trend of enrollment growth. The negative outlook reflects the expectation that the district's financial position may deteriorate further due to the continued reliance on general fund reserves to balance financial operations.
