Moody's downgrades some of Rochester's debt
A credit rating agency has lowered the rating on some of the debt that belongs to the City of Rochester.
It is tied to financial problems in the school district.
The information was released this week by Moody’s Investor Service, which lowered the debt rating on some of the debt the city has by two steps to A2. That is still considered an investment grade, but it is not as high as the Aa3 rating the city had previously.
In its announcement, Moody’s says the downgrade reflects the “significant decline in reserves and liquidity” at the city school district. Moody’s says that’s due to poor budgeting of various costs in the district. The city provides a certain amount of funding for the school district.
Moody’s also says the rating does reflect a relatively strong financial profile in the city’s general fund.
The school district is grappling with a potential budget shortfall of more than $64 million.
A statement released Tuesday by City Hall says that Moody’s action is exactly what Mayor Lovely Warren and others have warned about for months. City officials say the school board must take action to address “their mismanagement of city schools.”
The City Hall statement says Moody’s noted the city’s overall financial health is strong, and officials say they will continue to work with the school district superintendent and other government partners on behalf of the children of Rochester.