CHICAGO — Moody's Investors Service this year has downgraded nearly a quarter of the local school districts it rates in Michigan, a big jump from last year that reflects growing budget strains and challenges.

In a report released Tuesday, Moody's said Michigan's school districts face serious challenges from falling enrollment, which leads to revenue declines, and rising pension obligations. Charter schools are part of the problem, driving up competition and leading to loss of students, the rating agency said.

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