MOODY'S UPGRADES TO Aa3 FROM A1 DEER PARK UNION FREE SCHOOL DISTRICT'S (NY) G.O. RATING

Posted on: June 25, 2010, 5:36 pm

NEW YORK, Jun 25, 2010 -- Moody's Investors Service has upgraded the rating to Aa3 from A1 on Deer Park Union Free School District's (NY) outstanding general obligation bonds, affecting $10.4 million of parity debt outstanding. The bonds are secured by the district's unlimited property tax pledge. The rating upgrade is based on robust operating performance, improved financial position buoyed by conservative financial management practices and ample liquidity leading to the district's substantially improved and expected maintenance of reserves. The Aa3 rating reflects the expectation that the district's $3.4 billion tax base with average socioeconomic characteristics, located in Suffolk County (rated Aa2/stable outlook), will remain sizeable, despite recent declines in market values in fiscal 2009 and 2010, and possible further declines over the near-term as a result of the current economic environment and softening of real estate market. Additionally, the district's debt burden is expected to increase but remain manageable given the district's high level of state building aid and future debt plans for the start of an energy performance contract totaling approximately $10.4 million. All of the district's debt is fixed rate and the district is not party to any derivative agreements...

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