School Lane Charter School, PA Bond Rating Outlook Revised To Stable From Negative On Contingent Risk Mitigation

Stocks and Financial Services Press Releases Wednesday November 2, 2016 08:43
NEW YORK--2 Nov--S&P Global Ratings

NEW YORK (S&P Global Ratings) Nov. 1, 2016--S&P Global Ratings revised its outlook on Bucks County Industrial Development Authority, Pa.'s outstanding revenue bonds, issued for School Lane Charter School, to stable from negative, and affirmed its 'BBB-' rating on the bonds.

At the same time, S&P Global Ratings assigned its 'BBB-' long-term rating to the authority's $27.3 million series 2016A tax-exempt and series 2016B taxable revenue bonds, also issued for the school.

"The revised outlook and rating affirmation reflect our view of School Lane's series 2016 issuance, which will fully refund the school's series 2007 bonds, as well as its series 2012 and 2015 variable-rate direct purchase bonds, thereby eliminating the contingent risk associated with balloon payments and restrictive covenants," said S&P Global Ratings credit analyst Avani Parikh. "Post-issuance, the school's debt structure will be entirely fixed-rate and more manageable at the current rating level, in our view."

In addition, the rating reflects S&P Global Ratings' view of School Lane's continued positive operating performance, steady enrollment growth trends, strong demand profile, and healthy unrestricted cash position, which provide cushion for some transition risk associated with grade expansions and new facilities.

The rating service believes School Lane's financial metrics are solid for the rating level and supportive of upward rating potential, but are offset, at this time, by the school's moderately high leverage and debt per student measures.

Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com for further information. Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at www.spcapitaliq.com. All ratings affected by this rating action can be found on the S&P Global Ratings' public website at www.standardandpoors.com. Use the Ratings search box located in the left column.


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