Lakeland has received a top rating from Moody’s Investors Service related to the bonds issuance for the high school project.
In a release published yesterday (12.7.17), the firm assigned Aa3 to Lakeland’s $48.5 million public improvement bonds, series 2017.
Part of the release issued by Moody’s:
“Rating Action:
Moody’s assigns Aa3 to Lakeland’s $48.5M Public Improvement Bonds, Series 2017
Global Credit Research – 07 Dec 2017
New York, December 07, 2017 — Issue: Public Improvement Bonds, Series 2017 (City of Lakeland School Project); Rating: Aa3; Rating Type: Underlying LT; Sale Amount: $48,455,000; Expected Sale Date: 12/14/2017; Rating Description: Lease: Appropriation;
Summary Rating Rationale
Moody’s Investors Service has assigned an Aa3 rating to Lakeland, TN’s Public Improvement Bonds, Series 2017 (City of Lakeland School Project). Moody’s also maintains a Aa3 rating on Lakeland’s outstanding general obligation bonds and issuer rating.
The Aa3 rating primarily reflects the city’s affluent tax base and strong financial position marked by ample reserve levels and balanced operations. The rating also reflects the city’s above average debt burden and concentrated tax base.”
Link to release: https://www.moodys.com/research/Moodys-assigns-Aa3-to-Lakelands-485M-Public-Improvement-Bonds-Series–PR_904339182 .
On their website, Moody’s is characterized as an essential component of the global capital markets, providing credit ratings, research, tools and analysis that contribute to transparent and integrated financial markets.
Josh Roman, vice mayor, said, “The rating is not only great for funding the school project but it is also encouragement and validation that we as a City are doing the right things financially.” He said the rating is the same given to Lakeland previously.
Commissioner Matt Wright said, “When bonds are being issued you have to go through a ratings process.” He noted that the $48.5 amount is the actual principle owed. The rest is pre-refunding and fees.
Vice Mayor Roman said pre-refunding is the escrowed interest until the CON is callable.
https://www.moodys.com/Pages/atc.aspx – Link to Corporation website.
https://www.moodys.com/Pages/amr002002.aspx – Link to Moody’s ratings.
https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004 – Rating symbols and definitions.
Three Boards within the City: Lakeland School Board, Board of Commissioners and Industrial Development Board this week voted yes to proceed with plans to issue public improvement bonds to fund acquisition and construction of a high school.
The mechanism approved by the three Boards would utilize a lease revenue bond rather than general obligation bonds and be financed through the IDB. Lakeland Middle Preparatory School (LMPS) was funded through a CON (Capital Outlay Notes) for $20 million over a 12-year period.
The amount to be financed is estimated to be $52.4 million which would include the current CON balance along with expenses for the school addition and CON interest in escrow. The cost of the high school wing was estimated to be $36.5 million by Dr. Ted Horrell, LSS superintendent. But the School System has $3.5 million left from the middle school construction that would be applied toward the cost of the high school.
Link to Lakeland Currents story about the approval: https://lakelandcurrents.com/thats-a-wrap-three-for-three/
