School bond ratings revised to ‘negative’ outlook

Fitch Ratings is concerned about the future of the Escambia County School District’s finances because of the COVID-19 pandemic. We can expect other municipal bond ratings to have similar outlooks.

Fitch Ratings has assigned a ‘AA-‘ rating to the following Escambia County School District, FL bonds – $40 million certificates of participation (COPS), series 2020A, that will be used to finance the cost of the acquisition and construction of a new elementary school. The bonds are scheduled for sale the last week of June via a negotiated sale.

In addition, Fitch has affirmed the following:

–$9.2 million refunding certificates of participation (COPS), series 2014 at ‘AA-‘;

–$38.4 million outstanding sales tax revenue bonds at ‘AA’;

–Issuer Default Rating (IDR) at ‘AA’.

The only negative is Fitch Rating has revised its outlook on the bonds from stable to negative because of the COVID-19 pandemic.

The negative outlook reflects the “unknown extent of changes in future state and federal aid to the district given shutdown measures related to the coronavirus pandemic and the district’s potential vulnerability if such revenue cuts are significant.”