S&P Assigns Aaa to South Portland, ME's GO Bonds; Outlook Stable
NEW YORK (Standard & Poor's) August 18, 2016--S&P Global Ratings assigned its ‘AAA’ rating to the City of South Portland, Maine's 2016 general obligation (GO) bonds. At the same time, S&P Global Ratings affirmed its 'AAA' long-term rating on the city’s GO debt outstanding. The outlook is stable.
The rating reflects our assessment of the following factors for the city:
- Very strong economy, with access to a broad and diverse metropolitan statistical area (MSA);
- Very strong management, with "strong" financial policies and practices under our financial management assessment (FMA) methodology;
- Strong budgetary performance, with balanced operating results in the general fund and an operating surplus at the total governmental fund level in fiscal 2015;
- Very strong budgetary flexibility, with an available fund balance in fiscal 2015 of 20% of operating expenditures, and the flexibility to raise additional revenues despite statewide tax caps;
- Very strong liquidity, with total government available cash at 40.8% of total governmental fund expenditures and 6.0x governmental debt service, and access to external liquidity we consider strong;
- Strong debt and contingent liability position, with debt service carrying charges at 6.8% of expenditures and net direct debt that is 64.4% of total governmental fund revenue, as well as low overall net debt at less than 3% of market value; and
- Strong institutional framework score.
Moody's Assigns Aaa to South Portland, ME's GO Bonds; Outlook Stable
Global Credit Research - 18 Aug 2016
New York, August 18, 2016 -- Issue: 2016 General Obligation Bonds; Rating: Aaa; Rating Type: Underlying LT; Sale Amount: $13,500,000; Expected Sale Date: 08/23/2016; Rating Description: General Obligation Limited Tax;
Summary Rating Rationale
Moody's Investors Service has assigned a Aaa rating to the City of South Portland, ME's $13.5 million 2016 General Obligation Bonds. Concurrently, Moody's has affirmed the Aaa rating on $43.9 million of outstanding rated general obligation debt. Moody's has assigned a stable outlook. The Aaa rating reflects the city's stable and diverse tax base with average wealth, well-managed financial position with strong reserves, and manageable debt and pension burdens.
The stable outlook reflects our expectation of continued stability in the city's financial position driven by conservative budgeting and adherence to formal policies. The outlook also incorporates the strength of the regional economy.
SOURCE: Moody’s Investors Service - Aaa ratings are assigned for issues judged to be of the best quality, carry the smallest degree of investment risk and are generally referred to as “gilt edged”. Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.
Budget and Financial Reports for the City of South Portland
The Annual Reports are a fiscal year snapshot of financial transactions, statement of assets and liabilities, departmental accomplishment, improvements, awards and other matters of historical significance.
The Comprehensive Annual Financial Report is the audited financial statements of the City. The statement is compiled from a review by a certified accounting firm utilizing Governmental Accounting Standards Board (GASB) requirements.
The Municipal Budgets are the approved budgets from the last three fiscal years for both the City and the School Department.
The Capital Improvement Budget is a seven year plan of expenditures for projects and equipment that have a greater than fiscal year life span.