Moody's Investors Service has downgraded the ratings of San Jose Redevelopment Agency Merged Project Area tax allocation bonds. The extent of the downgrades depends on each bond series' specific pledged revenues--whether housing or non-housing--and how the debt service reserve requirement is met. The Agency's non-housing tax allocation bonds with cash funded debt service reserves or reserves that are met with sureties from investment grade providers have been downgraded to Ba2 from Baa2. These include: Series 1993, Series 1997, Series 2003, Series 2004, Series 2005A, Series 2006C, Series 2008A, and Series 2008B, which total approximately $1.08 billion in total outstanding debt. The Agency's non-housing tax allocation bonds with debt service reserve requirements met with below investment grade surety policies have been downgraded to Ba3 from Baa3. These include: Series 1999, Series 2002, Series 2005 B, Series 2006 A, Series 2006 B Series 2006 D and Series 2007, which total approximately $670 million in total outstanding debt. Bonds benefitting from the pledge of low-and-moderate income housing tax increment revenues have been downgraded to Baa2 from A3. All ratings remain under review for possible downgrade.


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