Moody's Investors Service said has downgraded to A2 from Aa3 the underlying rating for Pueblo County School District 70 (Pueblo County), Colo., affecting $100 million in outstanding general obligation unlimited tax debt.
The bonds are secured by the district's full faith, credit, and unlimited property tax pledge. A negative outlook has been assigned to the district.
The A2 underlying rating is primarily based on the district's deteriorating financial performance including declining reserve levels.
The rating further reflects the moderately sized and somewhat concentrated tax base, and elevated levels of both direct debt and pension liabilities. The negative outlook reflects very limited financial flexibility and expected continuation of stressed financial operations leading to further declines in reserves for at least the next two years.
