Moody’s considers possible downgrade of DeKalb school bonds
Moody’s Investors Service is warning that it will review the DeKalb County School District for a possible downgrade of its bond rating.
Moody’s will reconsider its ratings for DeKalb’s general obligation bonds and certificates of participation (a method of borrowing by governments, typically to finance construction), which currently enjoy strong ratings. The school district has $33 million in outstanding general obligation debt rated at Aa3 and $109 million in outstanding certificates of participation with an A1 rating.
The Moody’s review awaits several anticipated events in June: the release of a state audit of DeKalb’s fiscal year 2012 finances, expected by June 30; projections about fiscal year 2013, which ends June 30; the passage of a balanced 2014 budget in June; and the outcome of an accreditation review by the Southern Association of Colleges and Schools.
SACS has threatened DeKalb with accreditation loss if certain steps are not taken by December and is expected to release a mid-year review soon.
DeKalb Superintendent Michael Thurmond, on the job since February, said he’s confident about the 2013 and 2014 numbers, but doesn’t know what to expect from the 2012 audit or the SACS review. He said the Moody’s announcement raises the stakes of the pending SACS report: “They’re providing notice [to bond buyers] that they have some concerns,” he said of Moody’s.
About the Author
Ty Tagami is a staff writer for The Atlanta Journal-Constitution. Since joining the newspaper in 2002, he has written about everything from hurricanes to homelessness. He has deep experience covering local government and education, and can often be found under the Gold Dome when lawmakers meet or in a school somewhere in the state.
