Moody's Investors Service said it has downgraded Milwaukee Area Technical College District, Wis.'s general obligation rating to Aa2 from Aa1.
Concurrently, Moody's has assigned a Aa2 rating to the district's $1.5 million general obligation promissory notes, Series 2013-14H. Debt service on the notes is secured by the district's general obligation unlimited tax pledge. Proceeds of the notes will finance building remodeling and improvement projects. Post-sale, the district will have $118.4 million of outstanding general obligation debt. The district's outlook is stable.
The Aa2 rating reflects the district's large and diverse tax base encompassing the greater Milwaukee (GO rated Aa2/rating under review - down) region; multi-year tax base declines; operating reserves that have declined in recent years but are expected to remain adequate following additional planned draw downs; a low debt burden and manageable unfunded pension liability; and a sizeable unfunded liability related to the district's other post-employment benefit (OPEB).
The stable outlook reflects our expectation that district management will continue to maintain sound financial operations through proactive management of expenditures, which is critical given the district's limited revenue raising flexibility and trend of enrollment declines. The outlook also reflects the district's sizeable and diverse tax base.
