The 'AA' enhanced rating on Lake Orion Community School District, Mich.'s 2006 unlimited-tax GO refunding bonds reflects the district's eligibility for, and participation in, the Michigan State School Loan Bond program. Section 16 of Article 9 of the Michigan Constitution (adopted in 1963) created the Michigan School Bond Loan Fund program to provide districts access to funds to avoid a default on qualified debt. Under this program, if a school district fails to meet its debt service obligation for qualified debt, the state treasurer is notified. The treasurer pays the required debt service, and payment to bondholders is uninterrupted. If the balance in the state's loan fund is insufficient to cover obligations, the state is required to make loans from
