NEW YORK--(BUSINESS WIRE)--Fitch Ratings has assigned an 'A' rating to the city of Syracuse, New York's (the city) approximately $13.345 million general obligation (GO) public improvement (serial) bonds, series 2008A (school purpose) and an underlying 'BBB' rating to the city's $8.830 million public improvement (serial) bonds series 2008B. The bonds are scheduled to price competitively on June 12, 2008.Additionally, Fitch has affirmed the 'BBB' rating on the city's approximately $307 million outstanding GO debt. The Rating Outlook is Stable.
The underlying 'BBB' rating reflects the city's high debt burden, relatively stagnant taxable base, and below-average economic indicators. Positive credit characteristic include the city's stronger than budgeted recent financial results and a notable reduction compared to prior years in budgetary gaps outlined in the city's four-year financial plan (2005/06-2009/10). While the city's above-average reliance on state-aid, limited financial flexibility, and continued structural imbalance at the school district remain a concern, Fitch believes these risks are somewhat mitigated by historically strong financial management practices and a solid level of general fund reserves.
The 'A' rating on the series 2008 A school purpose bonds is based on Fitch's program rating on the New York Credit Enhancement Program, enshrined in section 99b of the state finance law. The law requires the state comptroller to cure certain defaults on local debt issued for school purposes by withholding subsequent state aid payments otherwise due to a school district. The Rating Outlook is Positive.
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