Oct. 5, 2007
King County maintains exceptional 'AAA' bond rating
The nation's top bond rating agencies have reaffirmed their AAA rating for King County as it prepares to issue bonds and bond anticipation notes to finance capital projects such as integrated security and health projects in the downtown Seattle jail.
Fiscal prudence and excellent work by the Executive's Budget Director and the Director of Finance and Business Operations and their staffs led to the exceptionally high bond ratings assigned by global financial firms Standard " Poor's, Fitch Ratings, and Moody's Investor's Service.
Standard & Poor's assigned a 'AAA' rating to more than $47 million of upcoming bonds and reaffirmed its 'AAA' rating on $1.8 billion in outstanding general obligation bonds that go to fund King County's agencies. Standard and Poor's gave its highest rating of SP-1+ to $45 million in bond anticipation notes planned for sale on the same day. Analysts lauded the county's financial practices.
"The county engages in sophisticated and conservative revenue planning that results in very accurate actual-to-budgeted performance," according to Gabriel Petek who wrote the Standard & Poor's assessment. "On the expense side, the county has effectively controlled cost growth rates and continues to actively pursue expense growth rate reductions in stubborn cost areas such as employee health care.
"I'm proud of the policies and our outstanding budget and finance staff who have done the work to maintain the county's strong financial health," said King County Executive Ron Sims. "As we prepare the 2008 budget we are being very careful to protect our financial standing despite revenue streams that are not keeping pace with inflation.
Fitch Ratings assigned a 'AA+" rating to the limited tax general obligation bonds and an 'F1+' rating to the bond anticipated notes and reaffirmed its 'AAA' rating to about $300 million in unlimited tax general obligation bonds as well as a 'AA+' rating to $1.2 billion in limited tax general obligation bonds.
"Management is excellent, as evidenced by the county's proven results and adherence to strong council-adopted financial management policies. The county's debt burden is low, as the county favors pay-as-you-go capital financing whenever possible." The statement said King County consistently achieves sound fund balances, despite economic fluctuations and a stringent property tax levy growth limitation due to Initiative 747.
The county plans to issue the $47 million in limited tax general obligation bonds and $45 million in bond anticipation notes through competitive bid on Oct. 15.