Moody's Assigns MIG 1 Rating to Fulton City School District's Bond Anticipation Notes

Strategic Insights -

The Moody's Investors Service has recently issued a rating for Fulton City School District's Bond Anticipation Notes, 2025, with a proposed par amount of $14.72 million. According to the rating rationale, the MIG 1 rating reflects the long-term credit quality of the anticipated take-out financing supported by the New York State Section 99-b Intercept Program, currently rated Aa3 with a stable outlook. The notes are protected under the intercept program, which would activate in the event of the district's failure to pay debt service.

Key Takeaways:

  • The MIG 1 rating on the bond anticipation notes is based on the long-term credit quality of the anticipated take-out financing supported by the New York State Section 99-b Intercept Program, which is currently rated Aa3 with a stable outlook.
  • The district's coverage of debt service from state aid revenues is projected to be 16.1 times, based on the 2026 adopted budget.
  • The notes are protected under the intercept program, which would activate in the event of the district's failure to pay debt service.
  • A decline in the district's coverage to below 1.0 times could lead to a downgrade of the rating.
  • The district is located on the Oswego River in Oswego County, approximately 25 miles northwest of the City of Syracuse.
  • The district provides K-12 education to approximately 3,000 students.

Statistics:

  • Proposed par amount of $14.72 million for the bond anticipation notes.
  • 16.1 times coverage of debt service from state aid revenues, based on the 2026 adopted budget.
  • Aa3 rating with a stable outlook for the New York State Section 99-b Intercept Program.
  • 25 miles northwest of the City of Syracuse.
  • Approximately 3,000 students provided with K-12 education.

Sources:

  • Moody's Ratings (Moody's) news release, Moody's Investors Service.
  • US Municipal Short-term Debt methodology, published in October 2024, available at https://ratings.moodys.com/rmc-documents/430699.
  • Rating Methodologies page, available at https://ratings.moodys.com.