Standard & Poor's Ratings Services said it lowered its underlying rating to A-minus from A on McLean County Community Unit School District No. 7 (Lexington), Ill.'s previously issued general obligation debt.
It also assigned an A-minus long-term rating to the district's series 2014 taxable GO school bonds. The outlook is negative.
"The rating action reflects our view of the district's continued reliance on bond proceeds to make up for shortfalls in its general fund," said Standard & Poor's credit analyst Jennifer Boyd.
The A-minus rating reflects the district's access to the diverse Bloomington-Normal, Ill., economy, strong income levels and market value per capita, and moderate overall debt burden.
The district will use proceeds from the series 2014 bonds to refund its series 2014 taxable alternate revenue source GO school bonds, and for capitalized interest.
The negative outlook reflects the likelihood the district will fail to make sufficient budget adjustments and eliminate its reliance on bond proceeds to support operations during the two-year parameter of the outlook, given the district's recent history of failing to meet its own timetable for such adjustments.
