Wilson Keeps Strong Bond Rating, Saves Money
Wilson, N.C. (June 11, 2014) - One of the nation’s top credit rating agencies announced this week that it will maintain the City of Wilson’s strong bond rating.
The ruling by Moody's Investors Service means it believes the city to be in great financial shape and easily able to pay its debts. A good bond rating ultimately saves the city money because it allows it to borrow money at lower interest rates.
Moody’s announced two decisions Tuesday.
- It had affirmed the Aa2 rating on the City of Wilson's (NC) $11.1 million General Obligation (GO) bonds. The bonds are secured by the city's unlimited ad valorem tax pledge.
- It has affirmed the A1 rating on the city's $56.2 million outstanding rated Certificate of Participation (COPs), Series 2007 and Series 2008.
Both ratings fall in Moody’s “high quality” scale. That means the city has “very strong credit worthiness” when compared to other municipal or tax-exempt bond issuers.
“This is great news, but I expected no less from our staff,” Mayor Bruce Rose said Wednesday. “We have an outstanding city manager, and the finance department has been extremely strong and detail-oriented the whole time I have been mayor."
City Manager Grant Goings paid tribute to Finance Director Kim Hands and her staff. “A lot of hard work went into this effort to uphold our rating,” he said Wednesday.
Moody’s recently completed an extensive review of the city’s financial conditions. Its findings suggest the city's tax base has been growing by an average of 4.2 percent over the past five years, and that growth is likely to continue.
The evaluators were also impressed with how the city had moved from a primarily agriculture and tobacco-based economy to one that’s more diverse. Targeted economic development programs have attracted industries such as pharmaceuticals and automotive parts. Moody’s foresees continued growth as long as the city has available land and resources to sustain the growth.
Wilson was credited with continuously exercising conservative budgeting practice. The city's fiscal performance will likely remain solid given this history of prudent budgeting practice.
The City was also recognized for their broadband network, Greenlight, which supports nearly 7,000 external customers, representing a total market penetration of 33.7 percent. Greenlight has grown at an average annual rate of 3.8 percent since 2009. The reliability and efficiency of services provided has driven customer growth and has resulted in steady revenue increase since the system launched in 2009.
Moody’s is one of the Big Three crediting rating agencies, along with Standard & Poor’s and Fitch Group, that evaluate the creditworthiness of public and commercial borrowers. Each agency issues ratings on a 10-point scale, although the names of the grades vary.