OREANDA-NEWS. S&P Global Ratings lowered its long-term rating to 'BB+' from 'BBB-'on the city of Brooklyn Park, Minn.'s series 2015A and 2015B, issued for Prairie Seeds Academy. The outlook is negative.

"The rating action and negative outlook reflect our view of the school's recent one-year, conditional charter renewal based upon poor academic performance, as well as its limited controls and management deficiencies," said S&P Global Ratings credit analyst Ashley Ramchandani."In our view, the 'BB+' rating is supported by the risk that the school's charter may be denied renewal on June 30, 2017."

The offsetting factors include historically positive operating results, strong liquidity levels, and solid lease-adjusted maximum annual debt service (MADS) coverage. In addition, the school's projected surplus operations support solid MADS coverage, and offset recent enrollment fluctuation, and its minimal demand profile, demonstrated by the school's modest waitlist. Improvement in academic performance and renewal of the charter are necessary to maintain the current rating.