Fitch Ratings gives ‘AAA’ rating to Santa Clarita Community College District bonds

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Fitch Ratings assigned an ‘AAA’ rating to Santa Clarita Community College District’s 2016 $20 million general obligation (GO) bond.

The ratings service also assigned an ‘AA’ rating to the district’s Issuer Default Rating (IDR).  This includes a ‘AA’ rating for $192.8 million outstanding GO bonds and a ‘AA-’ rating for $15.5 million outstanding certificates of participation (COPs).

“The distinction between the ‘AAA’ rating on the series 2016 bonds and the ‘AA’ IDR reflects Fitch’s assessment that bondholders are legally insulated from any operating risk of the district,” Fitch Ratings said in a press release.

This means that the original use of the bond begins with the taxpayer.

The bonds serve College of the Canyons, which operates two campuses with an approximate fulltime enrollment of 16,000.

The bonds are expected to price the week of Nov. 7 and proceeds of the bonds will fund capital improvements and pre-pay debts, according to the press release.

The ratings were assigned on “key rating drivers” including special revenue analysis and the Santa Clarita Community College District’s tax base.

The district is said to have a strong, diverse resource base supporting the GOs.  The district is also said to have benefited “from ongoing housing development, above-average population growth, and access to the broad and diverse Los Angeles regional economy.”

Fitch Ratings said the outlook for the ratings look stable.

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