St. Paul Park city bond rating increased to AA
For the first time in five years, the city of St. Paul Park’s bond rating increased.
Standard & Poor’s, an international market credit rating firm, re-evaluated the city’s bond rating, bumping it up from AA- to AA. The rating is two below the firm’s highest rating, AAA.
The upgraded bond rating allows the city to secure lower interest rates on bonds to finance capital improvement city and equipment.
The findings of the recent bond rating assessment said “strong budgetary performance,” “very strong liquidity providing very strong cash levels” and “very strong management with strong financial policies and practices” was the rationale behind increasing the score.
The assessment looked highly on the city’s ability to have available reserves at 44 percent of operating expenses at the end of fiscal year 2012, giving it flexibility in the coming year. With a city policy to keep the balance of the general fund at 35 percent to 50 percent of expenditures, city management was praised for having money on hand for cash flow needs and emergency contingencies.
City Administrator Kevin Walsh attributed the rating increase to the the diligent work done by city staff, especially Kim Sommerland, the city financial officer.
“She has overhauled this entire department since she’s been here,” Walsh said, adding her knowledge of current bookkeeping technology has better organized the city’s finances. “Her expertise and knowledge of budgets has a lot to do with the increased score.”
Walsh also applauded the efforts of the City Council, who he said are “a large part of the strong financial management, ultimately making the decisions that help keep the city financially secure.”
St. Paul Park Mayor Keith Franke said he was grateful for the budget-conscious staff.
“Thank you for all the hard work you’ve done.” he said. “I think we’re moving in the right direction.”