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Fitch Ratings assigns 'AA-' rating to Colorado Charter School Moral Obligation Program.

New York: Fitch Ratings, a nationally recognized statistical rating organization (NRSRO) designated by the U.S. Securities and Exchange Commission, assigned a 'AA-' rating to the Colorado Charter School Moral Obligation Program (MO program). Upon request, Fitch will assign the 'AA-' rating to eligible charter school debt.

The total amount of Colorado charter school debt currently outstanding under the program is approximately $374 million. Fitch has also affirmed the 'AA' rating on the Colorado School Credit Enhancement Program (also known as the school district intercept program, or SDIP). Upon request, Fitch will assign the 'AA' rating to eligible Colorado school district debt. The total amount of Colorado enhanced school bonds currently outstanding is approximately $9.2 billion.

Its SDIP for school districts provides that the state will make payments to the bond-paying agent for debt service upon notification that the participating district will not provide the funds. The state's MO program for eligible charter schools provides that in the event of a draw on any eligible charter's debt service reserve fund (DSRF) the Colorado Educational and Cultural Facilities Authority (CECFA), the issuer of the charter's bonds, shall request the governor to replenish the DSRF and the governor pledges to seek a state legislative appropriation for DSRF replenishment. This moral obligation of the state provides the basis for the rating.

CECFA shall request the governor to seek a state appropriation to replenish participating charter schools' bond reserves if the reserves fall below maximum annual debt service requirements, and the governor shall request a legislative appropriation to replenish the reserve. State law establishes clear processes that would allow for timely payment of principal and interest, if a school district does not make a scheduled debt service payment on GO bonds and certain electoral authorized lease purchase agreements issued after July 1991.

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Publication:Daily the Pak Banker (Lahore, Pakistan)
Date:Sep 27, 2018
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