Standard & Poor's Ratings Services said it has lowered its underlying rating on Will County Community Unit School District No. 365-U (Valley View), Ill.'s general obligation bonds to AA-minus from AA.
The outlook is stable.
"We base the downgrade on continual drawdowns on the district's fund balance, as well as a multi-year history of deficits," said Standard & Poor's credit analyst Christina Marin.
The current fund balance is $17 million, a decline from $46.3 million in 2011.
Although it still considers these levels "good," they are no longer commensurate with the current rating level. District officials say that reduced state aid and limited property tax-raising abilities have made it challenging to maintain level services. Nevertheless, they expect improved performance in fiscal years 2015 and 2016.
