Fitch Ratings has published an exposure draft of the charter school criteria outlining the agency’s changes to the way it analyzes charter schools. The draft includes a number of proposed amendments to existing criteria. If applied in the proposed form, the exposure draft would trigger a substantial number of downgrades to existing charter school ratings. Recent events in the charter school sector led Fitch to re-evaluate its assessment of the financial and operational downside risks facing these entities. Fundamentally, Fitch views charter schools as inherently non-investment grade because of their typically high leverage and lack of operational and financial flexibility. Those schools with significant credit strengths could reach investment grade, but will be capped in the ‘BBB’ rating category. Fitch invites feedback on the exposure draft during a four-week comment period ending Aug. 20, 2012. Please submit comments to csfeedback@fitchratings.com