S&P Global Ratings affirmed its 'A' long-term rating on Marshalltown Community School District (CSD), Iowa's outstanding general obligation (GO) bonds. The outlook is negative. The negative outlook reflects our view that, while the district's finances have recently improved, there is at least a one-in-three chance of a lower rating in the two-year outlook horizon if significant staffing and capital needs, as well as potential exposure to litigation risk related to alleged criminal activity of former district staff, lead to a material deterioration in the district's enrollment, and financial and debt profile. The district's unlimited-tax GO pledge secures the bonds. The negative outlook reflects the district's elevated human capital social risk relative to peers under our environmental, social, and governance (ESG)
