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Westfall Local School District, OH -- Moody's assigns Aa2 and Aa3 ratings to Westfall Local School District, OH's GO bonds and COPs, respectively

·12 min read

Rating Action: Moody's assigns Aa2 and Aa3 ratings to Westfall Local School District, OH's GO bonds and COPs, respectivelyGlobal Credit Research - 23 Feb 2021New York, February 23, 2021 -- Moody's Investors Service has assigned a Aa2 rating to Westfall Local School District, OH's $15 million School Facilities Construction and Improvement Bonds, Series 2021 (General Obligation - Unlimited Tax) and a Aa3 rating to the district's $13 million Certificates of Participation (Westfall Local School District, Pickaway and Madison Counties, Ohio School Facilities Project), Series 2021. Concurrently, Moody's has assigned a Aa2 issuer rating to the district and has affirmed the Aa2 rating assigned to its previously issued general obligation unlimited tax (GOULT) bonds. The issuer rating reflects the district's ability to repay debt and debt-like obligations without consideration of any pledge, security, or structural features.RATINGS RATIONALEThe Aa2 issuer rating incorporates the district's strong full value per capita, above-average resident income profile, and positive student enrollment trends. Additionally factored are its robust operating fund balance and liquidity and moderate long term liability leverage.The instrument rating of GOULT bonds is equal to the district's issuer rating based on the its full faith and credit pledge as well as an unlimited property tax to pay debt service on the bonds.The Aa3 rating assigned to the district's certificates of participation (COPs) is one notch below the issuer rating, reflecting the contingent nature of the security pledge, which is subject to annual appropriation, and the more essential nature of the financed projects. All of the district's actively managed general revenue is available for appropriation.RATING OUTLOOKOutlooks are typically not assigned to local governments with this amount of debt.FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS- Material expansion and diversification of the district's economy and tax base- Moderation to the district's long-term liability leverageFACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS- Material contraction to the district's economy and tax base- Significant narrowing of operating reserves combined with declines to student enrollment- Pronounced increases to the district's long-term liability leverageLEGAL SECURITYOutstanding GOULT bonds, including the Series 2021 bonds, are secured by the district's full faith and credit, along with its pledge and authorization to levy a dedicated debt service ad valorem property tax levy that is unlimited as to rate or amount.The Series 2021 COPs are secured by the district's pledge to make annual lease rental payments pursuant to a lease agreement. The payments are subject to annual appropriation by the Board of EducationUSE OF PROCEEDSThe authority to issue the bonds was granted by district voters at a November 2020 election. Proceeds from the bonds will ultimately be used for the purpose of constructing, renovating, and equipping school facilities, along with making land purchases. A portion of the Series 2021 bonds will take out short-term bond anticipation notes (BANs) issued in December 2020 to begin the capital projects. In addition to the bonds the district will be issuing the COPs to round out the financing of its capital plan.PROFILEWestfall Local School District covers approximately 200 square miles over Pickaway (Aa2) and Madison Counties in the central portion of the State of Ohio (Aa1 stable). The district operates four school facilities, providing preK-12th grade education to 1,437 students for the fiscal 2020 school year.METHODOLOGYThe principal methodology used in these ratings was US K-12 Public School Districts Methodology published in January 2021 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBM_1202421. Alternatively, please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.REGULATORY DISCLOSURESFor further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody's Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.For ratings issued on a program, series, category/class of debt or security this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series, category/class of debt, security or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.Moody's general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1243406.Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating. Andrew Van Dyck Dobos Lead Analyst Regional PFG Chicago Moody's Investors Service, Inc. 100 N Riverside Plaza Suite 2220 Chicago 60606 US JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Christopher Coviello Additional Contact Regional PFG Northeast JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Releasing Office: Moody's Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 © 2021 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. 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