Moody's Investors Service said it has downgraded to A2 from A1 the city of Pearl, Miss.'s general obligation rating, affecting $16.9 million of outstanding Moody's-rated debt.
The city has an additional $12.8 million of general obligation debt outstanding that is not rated by Moody's but was considered in the credit analysis.
The bonds are general obligations of the city and are secured by an unlimited tax pledge.
The downgrade to A2 reflects the city's limited financial position, including narrow cash levels within the general fund. The rating further considers the strong and growing economy based in the Jackson metropolitan area, income and unemployment levels that compare favorably to state averages, and an elevated but manageable debt burden that is expected to increase with an additional planned issuance in fiscal 2013.
