Moody’s Investors Service has downgraded Rockford’s general obligation rating to Aa3 from Aa2 ahead of its sale of $3.4 million of unlimited-tax alternative revenue source GOs.

The move affects $147 million of debt, including the upcoming GO sale. Proceeds will finance improvements to the city’s water utility. Debt service will be paid with net revenue of the water utility although the bonds carry Rockford’s full faith and credit pledge.

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