...S&P Global Ratings assigned its 'A' long-term rating to the City of Donna, Texas' series 2016 certificates of obligation. At the same time, S&P Global Ratings affirmed its 'A' rating on the city's general obligation (GO) debt outstanding. The outlook on all ratings is stable. The 2016 certificates constitute direct obligations of the city, payable from a combination of the levy and collection of a continuing annual ad valorem tax, within the limits prescribed by law, on all taxable property within Donna, and a limited pledge of surplus net revenues of the city's waterworks and sewer system. The maximum allowable rate in Texas is $2.50 per $100 of assessed value for all purposes, with the portion dedicated to debt service limited to $1.50. The city's levy is well below the maximum, at 98.28 cents, 19.15 cents of which is dedicated to debt service. We do not differentiate between the limited tax pledge and the city's general obligation given the significant financial flexibility. In addition,...
