City of Laredo Maintains Positive Bond Rating
Written by admin, Jun 22, 2021, 0 Comments
Courtesy Noraida Negron,
Laredo, Texas – The City of Laredo is pleased to announce that it has received outstanding ratings from S&P Global and Moody’s Investors Services. City leaders met recently with both agencies as part of the process of issuing their rating scores. The City is selling five bonds including: two General Obligation Refunding Bond, two Certificates of Obligation Bonds, and one Sports Venue Sales Tax Revenue Bond, Taxable Series. Through these bond ratings, the City received a high credit score that will allow for lower interest rates and provide confidence to its bond holders.
“Given the ongoing COVID-19 economic downturn as further exacerbated by the prolonged bridge closures to Mexican tourists and shoppers, I am delighted that our credit ratings have remained very stable,” stated Mayor Pete Saenz. “Our economy has been tested and proven to be resilient. This is a testament to the strength and faith of our people, helping each other during difficult economic challenges. Our economy is continuously improving, and I foresee better and greater things for our community including earning higher credit ratings in the future.”
City Manager, Robert A. Eads, also stated, “As always, this is a positive milestone for our city. Even after an economically challenging year across the globe, I am proud of our team’s ongoing commitment to maintain a solid financial base year after year.”
Approval of the bond sales is scheduled for Monday, June 21st, during the regular City Council Meeting.
The ratings from the agencies include:
· S&P Global (A+ Rating) & Moody’s Investors Services (A1)
o The City received these ratings based on its $49.8 million Sports Venue Tax Revenue Bonds, Taxable Series 2021. The bonds are being issued for the acquisition and construction of a sports complex and related infrastructure.
· Moody Investors Services (Aa2)
o Moody’s Investors Service has assigned a Aa2 rating to the City of Laredo on $27.4 million Combination Tax and Revenue Certificates of Obligation, $2.2 million Combination, Tax and Revenue Certificates of Obligation Bond, $4.2 million General Obligation Refunding Bond, and $4.1 million General Obligation Refunding Bond. The Aa2 issuer rating reflects the City’s growing tax base along the US-Mexico border, and recognizes the city’s national importance as home to the largest land port in the U.S. , which are balanced against below-average resident income levels.
Key considerations for credit for these ratings include:
· A broad and diverse local economy;
· Adequate DSC, supported by an anticipated return to positive pledged revenue growth for fiscal 2021;
· Low volatility in a broad sales tax pledge; and
· The city’s general creditworthiness does not constrain the credit strengths of the pledged tax revenue structure.
