Ratings Agencies Reaffirm City of Alexandria’s Bond Rating
Standard & Poor’s and Moody’s Investors Service have reaffirmed the City of Alexandria’s bond ratings of ‘AAA’ and ‘Aaa,’ respectively. The City has maintained these top grades from both major bond rating agencies since 1992.
Bond ratings (expressed in letters from ‘AAA’ to ‘C-’ for investment grade bonds on S&P’s rating scale, for example), are grades given to bonds that indicate their credit quality. Private independent rating services provide these evaluations of a bond issuer’s financial strength, or its ability to pay a bond’s principal and interest in a timely manner.
In reaffirming the City’s bond rating, Moody’s cited Alexandria’s “very conservative debt issuance guidelines," and said the City’s “financial position will continue to remain healthy in the medium term due to strong financial management and conservative budgeting."
However, Moody's maintained its negative outlook on Alexandria's ‘Aaa’ rating, due to the City’s indirect linkages to the weakened credit profile of the U.S. government. Surrounding jurisdictions, including Fairfax and Arlington Counties, received negative outlook ratings as well, and for the same reason.
S&P also assigned a stable outlook to Alexandria’s series 2013 general obligation (GO) capital improvement bonds and affirmed its ‘AAA’ rating, with a stable outlook, on the city's existing GO debt.
Standard and Poor's notes the rating reflects “deep, diverse, and strongly performing local economy, which serves as one of the anchors of the greater Washington and northern Virginia regions,” adding, “Finances remain, in our view, very strong, characterized by a history of strong financial performance, strong reserves, and strong management oversight.”
“That the City received the top grades from these ratings agencies is clearly a strongly positive message concerning the City’s financial condition,” said Alexandria Mayor William D. Euille. “Once again, we’ve worked hard to maintain the careful financial planning and strong fiscal management that has earned Alexandria these rankings for more than two decades.”