Summary: Lake Orion Community School District, Michigan; General Obligation; School State Program

S&P Global Ratings lowered its underlying rating to 'A+' from 'AA-' on Lake Orion Community School District, Mich.'s general obligation (GO) bonds. The outlook is stable. The rating action reflects our view of the district's weakened reserves, following five years of consecutive general fund deficits. In our view, the district's reserves, which have fallen below the policy-mandated level of 10%, are no longer sufficient to offset risk from the district's reliance on per-pupil-based state aid. Although the district has taken steps to address recent enrollment volatility, we see heightened credit risk given recent budgetary performance. The district's bonds are secured by its unlimited and limited GO pledges. The limited-tax GO bonds are subject to applicable constitutional and statutory tax rate

...S&P Global Ratings lowered its underlying rating to 'A+' from '##-' on Lake Orion Community School District, Mich.'s general obligation (GO) bonds. The outlook is stable. The rating action reflects our view of the district's weakened reserves, following five years of consecutive general fund deficits. In our view, the district's reserves, which have fallen below the policy-mandated level of 10%, are no longer sufficient to offset risk from the district's reliance on per-pupil-based state aid. Although the district has taken steps to address recent enrollment volatility, we see heightened credit risk given recent budgetary performance. The district's bonds are secured by its unlimited and limited GO pledges. The limited-tax GO bonds are subject to applicable constitutional and statutory tax rate limitations. We do not differentiate between a full faith credit and resources GO pledge to levy ad valorem property taxes on an unlimited and limited basis, because we believe the district possesses...

Summary