New York, June 20, 2012 --

Moody's Rating

Issue: General Obligation Refunding Bonds, 2012 Series A; Rating: Aa3; Sale Amount: $49,900,000; Expected Sale Date: 06/20/2012; Rating Description: General Obligation

Issue: General Obligation Refunding Bonds, 2012 Series B; Rating: Aa3; Sale Amount: $32,500,000; Expected Sale Date: 06/20/2012; Rating Description: General Obligation

Opinion

Moody's Investors Service has assigned an Aa3 rating to the Fresno Unified School District (CA) 2012 General Obligation Refunding Bonds Series A, for approximately $49.9 million, and 2012 General Obligation Refunding Bonds Series B, for approximately $32.5 million. Concurrently, we have affirmed the Aa3 rating on the district's outstanding GO debt. The general obligation (GO) bonds are secured by an unlimited property tax pledge. The 2012 Series A bonds are being issued to refund a portion of its General Obligation Bonds, Election 2001, Series D and Series E, and 2004 Refunding General Obligation Bonds, Series A. The 2012 Series B bonds are being issued to refund a portion of its 1998 General Obligation Refunding Bonds, Series A and Series B.

RATING RATIONALE

The district's ratings reflect its relatively large residential tax base, below-average socioeconomic profile, low direct and moderate overall debt burdens, satisfactory financial reserves that have gradually improved, and large post-retirement healthcare liability.

The rating also reflects the strength of the voter-approved, unlimited property tax pledge securing the bonds and the well-established levy and collection history for the debt service levy. This supports the credit quality of these bonds, largely offsetting potential financial challenges going forward. The county rather than the district levies, collects, and disburses the district's property taxes, including the portion constitutionally restricted to debt service on general obligation bonds. This supports the credit quality of these bonds.

STRENGTHS

-Large, diverse tax base

-Financial profile gradually improving due to significant expenditure reductions that offset the district's ongoing revenue declines

CHALLENGES -Low wealth levels -Declining AV trend -Financial uncertainty facing all California school districts

What could move the rating-UP

-Trend of significantly improved and maintained general fund reserve levels

-Substantial improvement in socioeconomic measures

What could move the rating-DOWN

-Deterioration in the district's financial position, including general fund reserve levels and/or cash position

-Weakening of socioeconomic measures

The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

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