Moody’s Investors Service Tuesday withdrew its ratings on the Vallejo Unified School District’s general obligation bonds, certificates of obligation, and special tax bonds, citing insufficient information.
Before the action, the school district had ratings of A2 on its GOs, A3 on its refunding COPs, Series 2003, and Baa2 on its Community Facilities District No. 2 special tax bonds, Series 2007, according to the rating report.
The bonds were placed under review on Oct. 26 based on a lack of sufficient current financial and operating information.
In the interim, analysts said they received financial information for 2009, but the auditor was unable to express an opinion on the financial statements at the district’s request.
Audited financial statements for fiscal 2010 and 2011 are not anticipated in the near or medium term.
The absence of up-to-date, audited financials is particularly critical now given the difficult fiscal environment for California school districts, analysts said.
California school districts have been hard hit by falling property valuations during the recession.
The declining values have decreased tax revenues.
At the same time, districts have lost money from the state.
Rating agencies have downgraded dozens of districts this year and many are still on watch for downgrades.
Though they are buffeted by the same economic and social problems, the school district is legally separate and distinct from the Vallejo city government, which emerged from Chapter 9 bankruptcy this year three years after filing.
