August 10, 2016
Contact: Jill Moberley, Public Information Officer
Jmoberle@dps.k12.oh.us
For Immediate Release
 
                                               Second appeal after downgrade disappoints district
 
     The Dayton Board of Education strongly disagrees with the new bond rating by Fitch. A lengthy appeal, pointing to dozens of inconsistencies and flawed assumptions, was filed by Board President Adil Baguirov, Ph.D.; Treasurer Hiwot Abraha;and the district’s municipal advisor, John Payne.
      “We are extremely disappointed by Fitch’s recent downgrade of our district’s bond ratings and question how their revised criteria would result in a drop of two notches from an A rating last September to BBB+ less than a year later,” Baguirov said. “Fitch’s report, which is filled with unreliable statistics and assumptions, did not justify for us the severity of their downgrade, from A to BBB+. The report also starkly contrasts with a June 2016 report by Moody’s, a much larger ratings agency, that affirms our fiscal health with a solid A rating.”
     Fitch’s rating seemed to overlook key factors that were weighed in favor of other Ohio districts.
While some district budgets were contingent on levy renewals, they were rated more highly, while Dayton has maintained a positive cash balance without seeking a levy.
     Revised criteria also place increased focus on competition from charter schools, but did not take into account the stabilization of charter enrollment in Dayton as indicated by ODE reports for FY16 and the fact that no enrollment increases are projected for charters over the next five years.
     The credit profile also fails to consider major developments underway in Dayton, which provide a strong economic base. In fact, a recent Dayton Business Journal report indicates investments of $600 million in Downtown Dayton redevelopment, with tens of millions more to come.
     “We continue to be accountable stewards of taxpayer dollars, with a positive cash balance and have followed all recommendations to ensure ratings improvements,” Baguirov said. “The appointment of our new Dayton Public Schools Treasurer Hiwot Abraha is another step in our continued efforts toward fiscal accountability and transparency.”
     Based on the new criteria, Dayton Public Schools is working to conform its reporting to the new methodology, which includes a mandatory 12 percent cash reserve.
     While the new rating by Fitch does not affect the district’s bonds or finances in any way, the report is discouraging and ignores measures taken by the district to ensure accurate and fair rating.
 
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