PLEASANT HILL -- The Pleasant Hill Recreation and Park District is considering refinancing old debt to take advantage of low interest rates.

The district owes about $2.2 million in outstanding certificates of participation it issued in the late 1990s to buy the land under the community center and Pleasant Oaks Park. Unlike general obligation bonds which are secured with property taxes, certificates of participation are repaid from general fund revenues.

"Rates are low, really low and there's an opportunity now for you to save some money," bound counsel Brian Quint told the district board members last week.

Noting that interest rates have inched up recently, Quint said the district will refinance only if doing so would result in overall savings of at least 3 percent.

The credit-rating agency Standard & Poor's is expected to assign the district a rating this week which the financial consultants hope will be higher than the rating from Moody's.

Moody's downgraded the recreation district's credit rating from A2 to A3 in March. The firm also dropped the rating on the outstanding certificates of participation.

The change in the district's rating, "reflects the continued decline in the district's general fund reserve levels since the last review, the district's continued weak ending cash balance and the expectation that the district will maintain narrow reserves in the near-term despite a small operating surplus in fiscal 2012," according to Moody's report.

Moody's previously downgraded the district's credit and the rating on the certificates of participation in December 2011.

In February, Fitch Ratings affirmed its A rating on the $20 million of general obligation bonds the recreation district issued to pay for the construction of new teen, senior and community centers. But the credit-rating agency also cited the district's tight budgets and concern that it will return to deficit spending as the reason for assigning a negative outlook for the rating.

Both Fitch and Moody's cite the district's stable tax base as a strength.

Over the past few years, the economic downturn, unexpected expenses and lost income from classes and rentals due to the closure of the community and senior centers put a strain on the district's finances.

The district ended the current fiscal year with $122,930 in reserves. The draft 2013-2014 budget projects revenue of $6.1 million and expenses of just over $6 million. The board is scheduled to discuss the budget at the June 27 meeting.

Lisa P. White covers Martinez and Pleasant Hill. Contact her at 925-943-8011. Follow her at Twitter.com/lisa_p_white.