News Column

City bond ratings affirmed

April 28, 2014

By Pat Kimbrough, The High Point Enterprise, N.C.



April 28--HIGH POINT -- The city has received high marks for a key part of its financial condition.

The three major credit ratings agencies affirmed previous assessments of the city's bonds. Standard & Poor's rated the city's 2014 general obligation and water and sewer revenue bonds AAA, which is the highest tier of credit worthiness and indicates that the city has "extremely strong" capacity to meet its financial commitments.

Fitch rated the bonds AA+ and Moody's gave the general obligation bonds an Aa1 rating and rated the water and sewer bonds Aa2. The Fitch and Moody's ratings differ slightly from the highest category and indicate "very strong" credit worthiness.

The ratings are critical in determining the city's ability to borrow money. Generally speaking, the stronger the rating, the lower the interest rate available.

"Please recognize that each of the rating agencies values and respects our commitment to disciplined financial practices," City Manager Strib Boynton explained in a memo to the City Council.

Financial Services Director Jeff Moore said the city had a successful sale this week of about $42 million in revenue bonds that will finance several water and sewer projects.

The city also plans to issue about $6.1 million in two-thirds bonds and $14.6 million in general obligation refunding bonds this spring.

Budget Director Eric Olmedo said key city revenue sources like property and sales tax collections are very strong so far this year and are ahead of the amount of receipts generated at this time last year.

The assessed value of the city's overall property tax base also is up so far this year by about 2.1 percent.

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(c)2014 The High Point Enterprise (High Point, N.C.)

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Source: High Point Enterprise (NC)