Moodys.com
Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
New Issue:

MOODY'S ASSIGNS A2 RATING TO UNIFIED PUBLIC SCHOOL DISTRICT NO. 1'S (ND) $1.5 MILLION LIMITED TAX BONDS, SERIES 2011

09 May 2011

A2 RATING APPLIES TO $1.5 MILLION OF POST SALE GO DEBT

Primary & Secondary Education
ND

Moody's Rating

ISSUE

RATING

Limited Tax Bonds, Series 2011

A2

  Sale Amount

$1,495,000

  Expected Sale Date

05/10/11

  Rating Description

General Obligation Limited Tax

 

Opinion

NEW YORK, May 9, 2011 -- Moody's Investors Service has assigned an A2 rating to the Unified Public School District No. 1's (ND) $1.5 million Limited Tax Bonds, Series 2011. This is an initial rating for the district. The district will have $3 million of general obligation debt after the transaction closes.

SUMMARY RATINGS RATIONALE

The bonds are special obligations of the district payable solely from a special levy (the HVAC Levy), which may be levied upon all property in the district at a maximum rate of 15 mills for 15 years. The 15 mill levy at the district's current valuation will generate $164,711. The maximum debt service for the bonds is $146,675 in fiscal 2012. Proceeds will finance various capital improvements throughout the district. The A2 rating reflects the district's modest and stable economy, sound financial operations, and manageable debt profile.

STRENGTHS:

-Continued tax base growth with both commercial development and continued demand for local housing

- Favorably located in a region with a strong economy driven by oil and energy demand

- Increased General Fund reserves

CHALLENGES:

- Limited tax base valuations

- Lack of diversity in the district's local economy as both Des Lacs and Burlington have relatively few local businesses

DETAILED CREDIT DISCUSSION

LARGELY RURAL TAX BASE FAVORABLY LOCATED NEAR MINOT IN A REGION DRIVEN BY OIL AND ENERGY DEMAND

The district serves the cities of Des Lacs and Burlington and the surrounding rural areas. Full valuation of the district is a modest $235 million and resident income indices approximate state averages. While the district's communities are mostly residential with very few businesses and the remaining areas of the district are mostly rural, the district benefits from its location near the city of Minot (GO rated Aa2/stable outlook) and the strength of the regional economy. Although the unemployment rate modestly increased in the past few months, it is still a very low 4% as of March 2011. Minot is located in north central North Dakota and the city serves as a regional economic hub. The city is the fourth largest city in North Dakota and serves as the county seat for Ward County. The city estimates its service and retail base draws customers from up to a 150 mile radius, including all of north central North Dakota and portions of the Canadian provinces of Manitoba and Saskatchewan. In addition to Minot's service and commercial sectors, the regional economy is mostly focused on agriculture and energy. The diversified employment base includes retail trade, health, and education sectors. Minot's regional economy is currently benefiting from the economic activity related to oil extraction and the strength of the energy industry in western North Dakota. Institutional presences also lend stability to the local economy. Nearby Minot Air Force Base is one of the nation's largest and is home to more than 10,480 active duty personnel and their dependents. With minimal risk of closure, the air force base provides significant institutional stability for the city and an economic impact of approximately $474 million in 2009. A second squadron of B-52's was recently added to the base, adding a significant number of families and personnel to the area. Additional economic stability is provided by Minot State University, with an enrollment of approximately 3,800 students.

HEALTHY FINANCIAL OPERATIONS SUPPORTED BY SATISFACTORY RESERVES

The district closed each of the past three fiscal years with operating surpluses. General Fund reserves have increased from $450,000 at the close of fiscal 2008 to $688,000 at the close of fiscal 2010 and increased slightly on a percentage basis from 9.7% to 12% of General Fund revenues. The district aims to maintain 10% to 12% of the budget in reserve. A small portion of the overall increase was due to an increase in federal stimulus funding as the district carried over approximately $200,000 in revenues from fiscal 2010. For fiscal 2011, the district will expend the remaining funds on various capital projects but despite spending the stimulus funds the district is currently expecting to end fiscal 2011 without reducing reserves. As no further federal funding increases are expected and the cost of personnel benefits is expected to continue to increase, district management is expecting greater challenges in realizing balanced operations in fiscal 2012.

MANAGEABLE DEBT PROFILE, WITH LIMITED BORROWING NEEDS

The district maintains a moderate direct debt burden of 1.4%, which should remain manageable, given strong local demand for housing driving tax base valuation growth, limited borrowing needs, and moderate amortization of existing debt. The overall debt burden is also moderate at 1.6%. Principal is amortized rapidly, with 81% retired in ten years. The district does not expect to issue additional debt in the near term. All of the district's debt is fixed rate and there is no exposure to derivative or swap agreements.

WHAT COULD CHANGE THE RATING UP:

- Significant expansion and diversification of the district's tax base

- Continued improvement in General Fund reserves and liquidity

WHAT COULD CHANGE THE RATING DOWN:

- Significant erosion of the district's tax base and demographic profile

- Operating deficits coupled with deterioration in General Fund reserves and liquidity

KEY STATISTICS

2000 Census population: 2,916 (+19% since 2000 Census)

2010 Enrollment: 581 (-1.2% annually since 2006)

2010 Full valuation: $235 million

Median family income: $44,683 (102.4% of state; 89.3% of US)

Per capita income: $15,926 (89.6% of state; 73.8% of US)

Ward County unemployment (3/11): 4% (ND at 4.2%; US at 9.2%)

Fiscal 2010 General Fund balance: $688,000 (12% of General Fund revenues)

Post-sale general obligation debt outstanding: $3 million

Debt burden: 1.6% (Direct debt: 1.4%)

Payout of principal (10 years): 81%

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009.

REGULATORY DISCLOSURES

Information sources used to prepare the credit rating are the following: parties involved in the ratings, public information, confidential and proprietary Moody's Investors Service information, and confidential and proprietary Moody's Analytics information.

Moody's Investors Service considers the quality of information available on the credit satisfactory for the purposes of assigning a credit rating.

Moody's adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process.

Please see ratings tab on the issuer/entity page on Moodys.com for the last rating action and the rating history.

The date on which some Credit Ratings were first released goes back to a time before Moody's Investors Service's Credit Ratings were fully digitized and accurate data may not be available. Consequently, Moody's Investors Service provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.

Please see the Credit Policy page on Moodys.com for the methodologies used in determining ratings, further information on the meaning of each rating category and the definition of default and recovery.

Analysts

David Horton
Analyst
Public Finance Group
Moody's Investors Service

Elizabeth Foos
Backup Analyst
Public Finance Group
Moody's Investors Service

Edward Damutz
Senior Credit Officer
Public Finance Group
Moody's Investors Service

Contacts

Journalists: (212) 553-0376
Research Clients: (212) 553-1653


Moody's Investors Service
250 Greenwich Street
New York, NY 10007
USA

MOODY'S ASSIGNS A2 RATING TO UNIFIED PUBLIC SCHOOL DISTRICT NO. 1'S (ND) $1.5 MILLION LIMITED TAX BONDS, SERIES 2011
No Related Data.
© 2020 Moody's Corporation, Moody's Investors Service, Inc., Moody's Analytics, Inc. and/or their licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND/OR ITS CREDIT RATINGS AFFILIATES ARE MOODY'S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY'S (COLLECTIVELY, "PUBLICATIONS") MAY INCLUDE SUCH  CURRENT OPINIONS. MOODY'S INVESTORS SERVICE DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY'S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY'S INVESTORS SERVICE CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS ("ASSESSMENTS"), AND  OTHER OPINIONS INCLUDED IN MOODY'S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY'S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY'S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND  PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND  PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY'S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES  ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR  PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT.

MOODY'S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided "AS IS" without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing its Publications.

To the extent permitted by law, MOODY'S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY'S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY'S.

To the extent permitted by law, MOODY'S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY'S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY'S IN ANY FORM OR MANNER WHATSOEVER.

Moody's Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody's Corporation ("MCO"), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody's Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody's Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and Moody's investors Service also maintain policies and procedures to address the independence of Moody's Investors Service credit ratings and credit rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold credit ratings from Moody's Investors Service and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading "Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy."

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY'S affiliate, Moody's Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody's Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to "wholesale clients" within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY'S that you are, or are accessing the document as a representative of, a "wholesale client" and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to "retail clients" within the meaning of section 761G of the Corporations Act 2001. MOODY'S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. ("MJKK") is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody's Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody's SF Japan K.K. ("MSFJ") is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization ("NRSRO"). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

​​​​​​​​
Moodys.com