Etiwanda School District Public Financing Authority, CA Revenue Refunding Bond Rating Raised To #AA#

Stocks and Financial Services Press Releases Thursday April 12, 2018 10:05
CENTENNIAL--12 Apr--S&P Global Ratings

CENTENNIAL (S&P Global Ratings) April 11, 2018--S&P Global Ratings raised its underlying rating (SPUR) to 'AA' from 'A-' on the Etiwanda School District Public Financing Authority, Calif.'s 2008 local agency revenue refunding bonds outstanding, based upon the application of our "Special Assessment Debt" methodology, published April 2, 2018, on RatingsDirect. The outlook is stable. The 2008 bonds are expected to be fully refunded following the successful closing of the series 2018A bonds. At that point, S&P Global Ratings would withdraw the rating on the series 2008 bonds.

In addition, S&P Global Ratings assigned its 'AA' long-term rating, with a stable outlook, to the authority's 2018A local agency refunding bonds, also based upon the application of our "Special Assessment Debt" methodology.

Bond proceeds will be used to refund the authority's 2008 local agency revenue refunding bonds outstanding, purchase a surety-funded debt service reserve (DSR), and pay the costs of issuance.

The bonds are secured by per-parcel Mello-Roos special taxes generated from five individual community facilities districts (CFDs)--Etiwanda School District CFD No. 4, No. 7, No. 8, and No. 2001-1, and Rancho Etiwanda CFD No. 1--and pooled by the authority using a Marks-Roos pooled financing structure to pay debt service on the bonds. The bonds are also secured by surplus tax revenues generated from the individual districts over and above the amount required to service their own individual share of bond payments.

"The 'AA' ratings reflect our view of the districts' strong economic fundamentals, characterized by strong incomes, a healthy labor market, and historical real estate volatility; strong to very strong district characteristics with little taxpayer concentration and complete development status; and very strong financial profile," said S&P Global Ratings credit analyst Michael Parker.

The stable outlook reflects the districts' low delinquencies and adequate to strong economic fundamentals. The stable outlook also reflects the districts' strong legal covenants and good coverage levels, supported by additional coverage above 1.0x at the local obligation level. We do not anticipate changing the ratings over the two-year outlook horizon.

Although not likely, we could consider raising the ratings if the district's overall local economy improves to a level we consider very strong.

We could lower the ratings if the local economy experiences significant housing volatility and foreclosure rates increase substantially, leading to pressure on debt service obligations that requires the use of the district's DSR.

Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at for further information. Complete ratings information is available to subscribers of RatingsDirect at All ratings affected by this rating action can be found on the S&P Global Ratings' public website at Use the Ratings search box located in the left column.

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