Cleveland Sub-Lien Income Tax Bond Rating Lowered To 'AA' On Criteria Application

CHICAGO (S&P Global Ratings) May 17, 2019--S&P Global Ratings lowered its long-term rating and underlying rating (SPUR) to 'AA' from 'AA+' on Cleveland's subordinate-lien income tax bonds and unrestricted income tax bonds (police and fire pension bonds). At the same time, S&P Global Ratings affirmed its AA+' long-term rating and SPUR on the city's general obligation (GO) bonds, reflecting an additional first-lien pledge of the city's 2.5% income tax. A subordinate lien on the total 2.5% income tax secures the subordinate income tax bonds. Securing debt service on the subordinate-lien unrestricted income tax bonds (police and fire pension bonds) is a subordinate lien on the unrestricted portion--or eight-ninths--of the city's income taxes levied at a rate of 2.5%. The outlook

...May 17, 2019 CHICAGO (S&P Global Ratings) May 17, 2019--S&P Global Ratings lowered its long-term rating and underlying rating (SPUR) to '##' from '##+' on Cleveland's subordinate-lien income tax bonds and unrestricted income tax bonds (police and fire pension bonds). At the same time, S&P Global Ratings affirmed its ##+' long-term rating and SPUR on the city's general obligation (GO) bonds, reflecting an additional first-lien pledge of the city's 2.5% income tax. A subordinate lien on the total 2.5% income tax secures the subordinate income tax bonds. Securing debt service on the subordinate-lien unrestricted income tax bonds (police and fire pension bonds) is a subordinate lien on the unrestricted portion--or eight-ninths--of the city's income taxes levied at a rate of 2.5%. The outlook is stable. The rating action reflects the application of our priority-lien tax revenue debt criteria, published Oct. 22, 2018 on RatingsDirect, which factors in both the strength and stability of the pledged...

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