Fremont Unified School District, CA (Aa3 issuer rating; Aa2 GOULT rating) benefits from strong resident wealth and income supported by a favorable location in the San Francisco Bay Area. The district's financial performance has weakened because of enrollment declines and growing expenses. Fund balance and liquidity are adequate, but significantly trail medians for the rating category. Projected outyear budget gaps are expected to be reduced given a history of positive variances, expenditure reductions and available federal aid. The district's elevated leverage and high fixed costs are a constraint on the credit profile.