MISD Building Bonds Outlook is Stable According to Recent Report
Aug 25, 2015 04:06PM
● By Kevin
Fitch Ratings has assigned an 'AAA' rating based on the Texas Permanent School Fund (PSF) and an 'AA+' underlying rating to the following unlimited tax (ULT) bonds for the Mansfield Independent School District, Texas (the district):
--$48.53 million ULT school building bonds, series 2015. This information comes courtesy of a July 24 report on BusinessWire.
The bonds [were] expected to price via negotiated sale the week of July 27 subject to market conditions. Proceeds will be used to fund facility improvements.
The district's $745 million of outstanding ULT bonds are currently rated 'AA+' by Fitch.
The Rating Outlook is Stable.
The following is the essential information, provided by BusinessWire.
The bonds are payable from an unlimited property tax levy and are further secured by the PSF bond guarantee program, rated 'AAA' by Fitch. (For more information on the Texas Permanent School Fund see 'Fitch Affirms Texas PSF Rating at 'AAA'; Outlook Stable', dated Sept. 4, 2014.)
KEY RATING DRIVERS
SUBSTANTIAL FINANCIAL CUSHION: The district's financial profile is characterized by healthy operating reserves, ample liquidity, and sound management practices, and is the key mitigant to the district's high debt burden.
SOUND TAX BASE GROWTH: The district's largely residential tax base reflects solid historical growth, albeit at an uneven post-recession pace. Reduced fiscal 2013 mineral values have been mitigated by growing residential and commercial property sector growth. The tax base is not concentrated.
HIGH DEBT, LIMITED CAPACITY: The district's overall debt is high, reflecting decades of healthy enrollment growth. Although nearing the statutory tax rate cap for new debt issuance, a trend of tax base growth in excess of enrollment growth provides the district with improved flexibility in the near term.
FAVORABLE ECONOMIC METRICS: The district's profile is characterized by high income and wealth levels, and unemployment is low.
MANAGING THE DEBT BURDEN: Debt service pressure on operations or frequent and recurring debt restructuring could result in negative rating action.
FINANCIAL FLEXIBILITY: An adequate financial cushion acts as a credit mitigant to the district's high debt, and any erosion of reserves below the target three month minimum could pressure the current rating.
Mansfield is located south of Fort Worth within the ninth largest metropolitan area in the nation, with 1.1 million residents located within a 15-mile radius. The city's estimated population of 61,000 has more than doubled since the 2000 census.
Read more detailed information on BusinessWire by clicking here.