Moody's Investors Service has downgraded the city of Tukwila, Wash.'s $26.8 million in outstanding parity limited tax general obligation bonds to A1 from Aa3 and also downgrades the issuer rating on the city to Aa3 from Aa2.
Moody's assigned an A1 rating to the city's Series 2012 LTGOs to be issued in the aggregate amount of approximately $945,000.
The current offering is secured by the full faith and credit of the city within the constitutional and statutory limitations of non-voter approved debt. Proceeds from the current offering will be loaned to the Tukwila Metropolitan Park District for improvements and upgrades to pool facilities owned by the district.
The downgrade of the rating from Aa3 to A1 reflects a continuing trend of operating deficits and structural imbalance as a result of cash-funded capital projects, dependence upon economically-sensitive revenues which are in a slow recovery, and the utilization of one-time revenues.
The A1 rating also reflects the moderately-sized and somewhat concentrated tax base that has experienced some relatively modest declines in recent years, satisfactory reserves below national median, and manageable debt levels.