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The Bond Buyer

Cannibalization of Georgia City Means Credit Risks for Other Municipalities

Neither bill apportions Stockbridge's outstanding, unrated debt, which would leave a smaller Stockbridge to pay all of the debt service if Eagle's Landing residents vote to incorporate as a new city.

Diverting half of Stockbridge's tax base without allocating the debt presents a "dangerous risk" for bondholders investing in general obligation bonds issued by Georgia's local governments, Matt Fabian, a partner at Municipal Market Analytics, said in Monday's Weekly Outlook.

"In a more conservatively spread bond market, borrowing for all Georgia local governments would rise sharply," said Fabian.

Tim Holler