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Moody's Investors Service Inc.

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

Strategic Insights

— 1 min read

The Moody's Investors Service has issued a rating of MIG 1 to the Tonawanda City School District's Bond Anticipation Notes - 2025, with a proposed par amount of $42.23 million. The rating reflects 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. The notes are covered under the intercept program, ensuring that if the district fails to pay debt service, the state aid intercept program would be activated. The district's coverage of debt service from state aid revenues is projected to be 5.7 times based on the 2025 adopted budget.

Key Takeaways:

  • The MIG 1 rating on the bond anticipation notes reflects 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.
  • The notes are covered under the intercept program, which ensures that if the district fails to pay debt service, the state aid intercept program would be activated.
  • The district's coverage of debt service from state aid revenues is projected to be 5.7 times based on the 2025 adopted budget.
  • Tonawanda City School District is located in Erie County in the southwestern region of upstate New York, providing pre K-12 education to approximately 1,700 students.
  • The rating methodology used in this rating was US Municipal Short-term Debt, published in October 2024, and available at https://ratings.moodys.com/rmc-documents/430699.
  • The outlook on the New York State Section 99-b Intercept Program is stable.

Statistics:

  • Proposed par amount of the Bond Anticipation Notes - 2025: $42.23 million
  • Projected coverage of debt service from state aid revenues: 5.7 times
  • Number of students served by the district: approximately 1,700
  • Rating on the New York State Section 99-b Intercept Program: Aa3
  • Outlook on the program: stable

Sources:

  • 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 on https://ratings.moodys.com

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