General obligations bonds for school modernization for the Garden Grove Unified School District got a boost Tuesday as the financial instruments got a high rating.
Moody’s Investor Service gave an Aa2 rating on $119.9 million Series C of the $248 million bond issue, approved by local voters in 2010. The Aa2 rating is considered to be the second- or third-best rating possible for bonds.
The service also affirmed its Aa2 status for Series A and B, which have helped finance upgrades on GGUSD construction now underway.
In its report, Moody’s supported its rating by noting that “the bonds are secured by an unlimited property tax pledge of the district.” Last week the GGUSD board voted to raise property taxes in the district to cover eventual repayment of the bonds; the typical homeowner will see a $7.22 increase in property taxes.
The rating could rise even further if the local tax property tax base improves. Property tax revenue is expected to rise as the sale of homes speeds up and prices rise.
The GGUSD has 65 campuses and serves most of Garden Grove as well as parts of Anaheim, Cypress, Santa Ana, Stanton and Westminster.