Moody's Investors Service revised its outlook on Lancaster County, Pa.'s general obligation bonds to negative from stable while affirming the A1 rating.
Lancaster County, which plans an $8.3 million GO sale the week of Feb. 18, has $280 million of debt outstanding. RBC Capital Markets is the lead manager of the negotiated sale.
The county will use proceeds to advance refund its Series 2004-A bonds for an estimated net present value savings of $580,000 or about 7.2% of par outstanding with no extension of the maturity structure, according to Moody's.
The negative outlook incorporates a probable sixth consecutive operating deficit in fiscal 2013, said Moody's, as well as the rating company's concerns that the county "will be unable to manage expenditures in a manner sufficient to offset additional near-term declines in reserves."
Moody's also cited the lack of a clear plan by county management to replenish fund balances.
Lancaster County's population, according to the 2010 census, is 519,445. County seat Lancaster sits between Philadelphia and state capital Harrisburg.
