Tuesday December 16, 2003
A leading Wall Street agency has upgraded the credit rating for Louisville Metro Government, citing a successful merger and a diverse economic base.
The change is the first independent assessment that the new government is in a stronger financial position as a result of steps taken during the first year of merged government.
Standard & Poor’s, one of the nation’s top credit rating agencies, upgraded the old city of Louisville’s general obligation bond rating to AA from AA-.
The rating for Jefferson County remained the same, AA. “These rating actions reflect the successful operational and financial consolidation of the governments of the city of Louisville and Jefferson County,” Standard & Poor’s said in its review of the government’s finances.
Specifically, the report cited:
· “a deep and diverse economic base”
· “solid, stable financial management”
· “a manageable debt burden”
Mayor Jerry Abramson said, the “upgraded rating serves as a financial report card for our new government and our community. It’s an independent validation of the value of merging governments and the steps we’ve taken with the Metro Council to put our new government on stronger financial footing.”
Abramson, members of his administration and 12th District Metro Councilman Rick Blackwell, who chairs the Appropriations Committee, visited with rating agencies on Wall Street earlier this year. Abramson said one of the chief benefits of the increased rating is that it will enable the new government in the future to issue bonds for new projects and infrastructure improvements more cost effectively.
In making its rating, Standard & Poor’s cited the steps taken by the new government to integrate services, enhance public safety and promote economic development and education. The report noted that Louisville Metro Government implemented a balanced budget that maintains services without raising taxes or drawing on reserves. The report also cited Louisville’s growing tax base, strong downtown development and significant private investment in the community.
The report is good financial news to people who own former City of Louisville bonds. The value of their bonds will increase as a result of the increased rating.