S&P: Overton Independent School District, TX Debt Outlook Revised To Positive On Improved Reserves
"The positive outlook reflects the district's increasing reserve levels in the last three fiscal years, and management's expectation to increase its reserves to 31% of operating expenditures in fiscal 2016," said S&P Global Ratings credit analyst Joyce Jung.
The long-term rating reflects our view of the district's eligibility for, and participation in, the Texas Permanent School Fund bond guarantee program, which provides the security of a permanent fund of assets that the district can use to meet debt service on bonds guaranteed by the program.
The 'A-' rating reflects our view of the district's:
Adequate income levels and low wealth level;Limited tax base, with a local economy concentrated primarily in mineral and lumber production;Very strong reserves; andMaximum maintenance and operations tax levy. We understand that bond proceeds will be used to refund the district's debt outstanding for savings.