Bond rating agencies: Philly schools finances 'stable

In recognition of the Philadelphia School District's improved finances, two New York bond rating agencies Friday boosted its credit outlook for the first time since 2010.

Moody's Investor Services and Fitch Ratings Inc. each changed their view of the district's finances from "negative" to "stable."

Superintendent William R. Hite Jr. said in a statement, "We have made concerted efforts to achieve and present a stabilized budget and long-term fiscal plan, and it is important that independent reviewers . . . are recognizing our efforts.

"While we will continue to work with our state and city funders to address the long-term fiscal challenges facing the district, all of those who are working with the district should take note of the positive review of our improved fiscal management," the superintendent said. "Our ultimate goal remains enhancing the educational outcomes of students in Philadelphia; long-term fiscal stability allows us to continue to make necessary and sustainable investments in our schools."

Uri Monson, the district's chief financial officer, said the improvement in the district's short-term financial outlook could encourage more investors to consider district bonds in future deals, which could result in lower borrowing costs for the district.

"More demand means better rates," he said.

In its announcement, Moody's said, "The stable outlook on the underlying rating reflects the district's recently improved financial position that is expected to increase again in fiscal 2016 and remain stable in fiscal 2017."

While the district projects it will need to tap reserves in the future, Moody's said it believed that the district's five-year financial plan was conservative, "as the district has historically outperformed budgeted figures."

Fearing another impasse over the state budget, Moody's in April had affirmed a negative credit rating for the district.

martha.woodall@phillynews.com 215-854-2789 @marwooda