1/21/12

Standard & Poors issued the advisory report Texas School Districts' Potential State Funding Paybacks Could Hurt Credit Ratings on the topic of Foundation School Program overpayments and potential adverse rating implications for certain school districts when significant amounts of overpayments are due to the Texas Education Agency.  The January 9, 2012 advisory report mentions a Dallas area school district whose rating was recently downgraded from A+ to BBB+ due to the sheer magnitude of the district's overpayment liability to the TEA relative to the district's General Fund budget.  The report further expresses S&P's concerns about certain districts' overpayment liabilities to the TEA on top of the per student funding reductions by the 82nd Legislature that resulted in the ongoing record number of nonrenewals of teachers and other staff, in addition to involuntary reductions-in-force in many school districts.  

To access the S&P advisory report on this topic, click on the link below.

S&P Texas School Districts' Potential State Funding Paybacks Could Hurt Credit Ratings (389.91 KB)