If the district maintains unrestricted reserves above 5% of spending and improves internal controls, processes, and maintains fiscal stability after its planned exit from state oversight, Fitch could take positive rating action, analysts said in Thursday's report. Moody's A1 rating on the district's GOULT bonds is one notch higher than the district's issuer rating. The positive outlook reflects Moody's expectation that the district will maintain a solid financial position largely due to management's recent fiscal operational improvements and commitment to maintaining reserves closer to 10%, it said.