Beachwood City Schools’ finances are safe for now despite the S&P’s decreased credit rating for the federal government.
Treasurer Michele Mills gave a short report at Monday’s Board of Education meeting.
The federal credit rating downgrade could have affected the district in two ways, said Mills: the value of its stocks portfolio could have decreased, and the district’s credit rating could have decreased.
But neither outcome occurred.
The district’s stocks portfolio — which, by state law, includes secure, liquid, long-term investments — saw decreased interest rates and increased prices, said Mills.
“Our portfolio is worth more today than it did Friday,” Mills added.
All AA credit ratings for agencies that may be dependent on the federal government went under review after the federal government’s credit rating was downgraded from Aaa — the highest attainable — to Aa+, said Mills.
Moody’s Investors Service determined that Beachwood City Schools’ credit was not dependent on the government and confirmed its Aaa* rating.
But the district will continue to monitor its stocks, like the rest of the country, Mills added.
“I think it’s a signal to the U.S. government to really get its financial house in order,” said Mills. “We’ve been doing that as a state all along, and it’s been very painful.”
Editor's Note: The original version of this article reported that the schools' credit rating was Aa.