Bonds sold by Santa Cruz County's redevelopment agency could still be downgraded because of a dispute with the California Department of Finance, according to Fitch Ratings.

Fitch said in a report Tuesday that it will keep $157 million of A-rated tax allocation bonds issued by the county's former redevelopment agency on rating watch negative because the county, as the successor agency for the RDA, disagrees with the state over distribution of tax money.

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