S&P raises Dickson County’s bond rating
DICKSON, TN – One of the nation’s leading financial analysis services has raised Dickson County’s bond rating for the second time in five years.
Standard and Poor’s Global Ratings announced last week that it has elevated Dickson County’s rating from “AA-“ to “AA” for its general obligation bonds, assigning the new rating for the county’s plan to borrow money in 2019 for projects that include the new criminal justice center and county library. The new rating reflects the ratings service’s confidence in the stability of Dickson County’s finances and will result in the county being able to borrow money at lower interest rates.
The S&P announcement also says bond proceeds will be used to refund the county’s series 2009 general obligation bonds for net interest cost savings.
S&P elevated Dickson County’s rating from “A+” to “AA-” in April 2014. The service’s top rating is “AAA.” That same year, Moody’s Investor Service improved Dickson County’s rating from “A1” to Aa3.”
“The improved bond rating from one of the nation’s ‘Big 3’ ratings services is good news for all Dickson County residents,” said Dickson County Mayor Bob Rial. “It is indicative of the confidence their analysts have based on the financial responsibility this county has exhibited, their evaluation of our fiscal management and the county’s strong budgetary performance.”
“The upgrade reflects our view of the county’s improved economic metrics, in particular its improved market value per capita, and maintenance of its very strong financial position,” says the announcement from S&P.
The service says the rating indicates S&P’s view of the county’s:
- Adequate economy, with access to a broad and diverse statistical area of Middle Tennessee;
- Adequate management, with standard financial policies and practices;
- Strong budgetary performance, with operating surpluses in the general fund in fiscal 2018;
- Very strong budgetary flexibility, with an available fund balance in fiscal 2018 at 36 percent of operating expenditures;
- Very strong liquidity, with total available cash at 83.3 percent of fund expenditures and 3.7 times governmental debt service;
- Low overall net debt at less than three percent of market value; and
- Very strong institutional framework score.
“Not only does S&P look at what we’re doing to manage our finances, but they also evaluate the county’s financial outlook,” Rial said. “Their experts look at what is expected financially in the near future and determine how well-equipped the county is to maintain its stability.”
S&P’s announcement calls the county’s outlook “stable” based on the county’s growing tax base and expectations that it will maintain its very strong financial position.
“We do not expect to change the rating over the two-year outlook horizon,” the announcement states.
U.S.-based Standard and Poor’s and Moody’s, along with Fitch Group based in New York and London are considered the top three financial ratings services in the world, controlling approximately 95 percent of the global market.