Moody's Investors Service has downgraded West Northfield School District, Ill.'s general obligation rating to Aa3 from Aa1.
Concurrently, a negative outlook has been assigned.
The downgrade to Aa3 and assignment of the negative outlook affects approximately $2.3 million of rated outstanding debt.
The district's outstanding debt is secured by the general obligation limited tax pledge payable from the district's Debt Service Extension Base (DSEB).
The downgrade of West Northfield School District 31's general obligation rating to Aa3 reflects the district's declining tax base, anticipated revenue losses resulting from ongoing tax appeal litigation with Allstate Insurance Company and increased dependence on working cash fund reserves to correct imbalanced operations in the educational fund.
The negative outlook is based on ongoing reductions and delays to state aid and potential future pressures on operating reserves if pension obligations are shifted from the State of Illinois to West Northfield School District 31 through pending pension reform legislation.