Flagler County announced today that Standard and Poor’s upgraded the county’s credit rating from A+ to AA-.
Palm Coast – December 23, 2013 – A conservative approach to Flagler County’s budget process has paid off, the County’s financial credit rating was recently upgraded.
Standard and Poor’s rating agency moved the county from A+ to AA- (the highest rating is AAA). As a result Flagler County taxpayers are expected to save hundreds of thousands of dollars in interest on funds for upcoming construction projects.
Similar to how a personal credit score helps individuals obtain better financing rates and terms, the same concept applies to businesses and local governments. The credit rating of the agency issuing the debt directly affects how potential bidders view that debt and what they will offer for it. This may also mean a greater number of bidders for any future County debt. Some retirement and investment funds can only buy debt rated AA or higher.
The letter and report from Standard and Poor Rating Agency included, “What we consider very strong liquidity supports the County's finances, with total available cash as a percent of total governmental fund expenditures ratio of approximately 60% and a debt service ratio above 500%.” The agency went on to say, “We believe Flagler County has exceptional access to external liquidity, as it is a regular issuer of sales tax, and non-ad valorem secured debt.”
“What this means,” County Administrator Craig Coffey said, “is that in future construction projects such as the Flagler County jail expansion and the consolidation of the Sheriff’s Office, the County will likely get a slightly better interest rate with a significant savings to the taxpayers over the life of the construction loan.”
“We are really excited about the new rating,” County Commission Chairman George Hanns said. “It is a compliment to the hard working individuals in our Administration and Financial Services Department and to the Flagler County Clerk’s Office, and well as the conservative financial approach the Board of County Commissioners has taken during the economic downturn.”
The new rating came as a result of a yearly review by Standard and Poor’s and it was based on the County’s financial status and its future potential.