MOODY'S DOWNGRADES THE TOWN OF HOLBROOK (MA) G.O. RATING TO Baa2 FROM Baa1

Posted on: December 23, 2009, 3:34 pm

NEW YORK, Dec 23, 2009 -- Moody's Investors Service has downgraded the rating to Baa2 from Baa1 on the Town of Holbrook's (MA) general obligation bonds, secured by a limited tax pledge. The downgrade reflects the town's distressed financial position, evident in a fiscal 2008 General Fund balance of negative $73,000 or a negative 0.2% of General Fund revenues, down from 4.6% in fiscal 2006 (ended June 30). The Baa2 rating also reflects the expectation that the town's moderately sized $1.3 billion tax base located approximately 19 miles from Boston (rated Aa1/stable outlook), could be vulnerable to valuation declines due to the current economic environment. The rating also reflects the town's average socio-economic profile and manageable debt burden at 1.9% of 2008 full value; debt is expected to remain manageable given the absence of future debt plans and an average rate of principle amortization (68.3% retired within 10 years). All of the town's debt is fixed rate and the town is not party to any derivative agreements...

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