|August 2, 1012
City of Chandler bond rating reaffirmed with stable outlook
Standard and Poor’s Rating Service has notified the City of Chandler that it has reaffirmed the City’s Water and Sewer Revenue Bond rating of AA+. “Chandler's financial performance has been strong in recent years,” said the Standard and Poor’s report. “The stable outlook reflects our expectation that strong financial performance will continue during the next two years.”
Through financial research and analysis, the credit rating agencies assess the creditworthiness of entities like the City of Chandler and the risk of holding bonds issued by those entities. The agencies review and update their bond ratings on outstanding debt every one to two years taking into account changes in the City and economy. Bonds that are rated Aaa or AAA are considered to be of the highest quality, with the smallest degree of investment risk.
In reaffirming their rating, Standard & Poor's identified the following factors in their review: the strong and diverse local service area economy; strong financial performance including strong senior lien debt service coverage of more than three times in 2011 and estimated for 2012, and liquidity equal to almost a year’s worth of operating expenses; sufficient water resources and sewer treatment capacity to meet demand; and, very competitive combined rates.
The affirmation does not have any direct impact on City operations or planned projects, and does not impact Standard and Poor’s AAA rating of the City’s General Obligation and Excise Tax Bonds. The Water and Sewer Revenue bonds are currently rated AA+ by Fitch Ratings and Aa1 by Moody’s Investor Services.
“Retaining our high rating is excellent news and it reinforces our reputation as a responsible community that demonstrates fiscal discipline, even during difficult economic times,” said Chandler Mayor Jay Tibshraeny. “These ratings tell everyone that an investment in Chandler is a smart decision.”
The City currently has about $44.7 million of Water and Sewer Revenue bonds outstanding (principal) as of July 1, 2012, and all debt is scheduled to be repaid by July 1, 2020.
For more information on City of Chandler bonds, please contact the City’s finance department at 480-782-2250.