Strong local economy credited for impressive bond ratings

Strong local economy credited for impressive bond ratings

1Chandler’s strong local economy
and financial practices have provided
city taxpayers with an economic
windfall.
The three major U.S. credit
rating agencies reaffirmed their
favorable view of Excise Tax Revenue
Obligations, which will be used to fund
various water and wastewater capital
projects.
Chandler officials had requested
the rating review in anticipation of an
upcoming sale of approximately $110
million in ETROs.
Both Fitch Ratings and Standard
& Poor’s Ratings Services announced
that they affirmed their highest AAA
long-term rating for Chandler’s 2013
ETROs. The third service, Moody’s
Investors Service, assigned an Aa1
rating, its second highest rating. All
three agencies assigned a “Stable”
outlook to Chandler’s financial
position.
Two of the agencies also reviewed
the city’s ratings for outstanding
general obligation bonds. Both
Fitch and Moody’s reaffirmed their
respective ratings of AAA and Aaa.
“By reaffirming our high ratings,
these agencies are reinforcing our
reputation as a well-managed city with
strong fiscal policies and a balanced
and flexible financial plan for the
future,” said Mayor Jay Tibshraeny.
“We are committed to maintaining
fiscal discipline, and that breeds
confidence among investors and
business leaders who see Chandler
as a place of opportunity. Our focus
remains on continued economic
growth for years to come.”
The ratings measure the city’s
financial management and position, as
well as the ability to repay outstanding
debt, according to Dawn Lang, the city
of Chandler’s management services
director. The higher ratings represent
a lower investment risk for potential
bond buyers and lower debt costs for
the city and its residents, she noted.
In their reports, the agencies
praised Chandler’s economy and its
management, with residents having
good access to strong local employers,
and the “expectation that management
will continue to maintain favorable
financial operations and healthy
coverage of all parity debt obligations.”
Excise Tax Revenue Obligations
are backed by excise taxes that include
a combination of local sales tax, state
shared revenues, franchise fees and
revenues from licenses and permits,
fines and forfeitures.
General Obligation bonds are
backed by secondary property tax
levies.

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