The Mount Vernon City School District has announced that Moody’s Investors Service upgraded to A1 from A2 the underlying rating of the school district’s $87 million in general obligation debt. Also, Moody’s upgraded the district’s enhanced rating to Aa3 from A1.
“The upgrade to A1 reflects the district’s sizable tax base, sound financial position underscored by a stable operating profile, and moderate debt and pension burdens,” Moody’s reported. “The rating further reflects the expectation that the district’s debt burden will increase modestly in the coming years.”
Moody’s also reported that the improvement in the enhanced rating is based on additional security provided by the New York State Section 99-B Intercept Program. The program authorizes the state to withhold state aid in order to make bond payments in the event of default.
“Our administrative team has worked tirelessly to put into place meaningful change in our school district’s financial structures to ensure that our debt rating improves and we are grateful that the Moody’s upgrades reflect these efforts,” remarked Superintendent of Schools Dr. Kenneth R. Hamilton. “As we begin to borrow money associated with the 20/20 Vision we will do so in a more competitive environment and receive lower interest rates saving us millions of dollars in debt service in the coming years. Less money on interest means more money for our schools and students.”