Clarksville earns favorable bond report
Moody’s Investors Services review rates City at Aa2
CLARKSVILLE, Tenn. – Moody's Investors Service, a leading provider of credit ratings, research, and risk analysis, has given the City of Clarksville an annual bond rating of Aa2, which is considered strong and stable.
The report said Clarksville's credit position is very good, and its Aa2 rating is a little stronger than the median rating of Aa3 for cities nationwide. Key credit factors noted in the report include a robust financial position, a small debt burden and a mid-range pension liability. The credit position also reflects a large tax base and a moderate wealth and income profile.
“This is a good report that shows our sound financial management,” Mayor Kim McMillan said. “This translates to favorable interest rates and lower borrowing costs when we need to issue bonds for road construction and other needs, which is good for our taxpayers.”
“Moody’s provides a comprehensive independent third-party look at the credit worthiness of the City, and this report is a really good review,” Laurie Matta, Clarksville’s Chief Financial Officer said.
The report states the City's cash balance as a percent of operating revenues is slightly below the U.S. median.
“This is due to a significant increase in operating revenues,” Matta said. “Since our revenues increased, the ratio went down, but this is not negative as it shows growth in our tax base, and growth in our economy. It’s important to note that the increase in revenue did not come from raised taxes, rather it came from growth. It’s all a sign of a really stable economy.”
Moody’s Investors Services reviews the City’s financial statements, the current budget, and how the City processes bills and makes payments to calculate its rating.
“The City has received this Aa2 credit rating for years now,” Matta said. “So it’s evident the City’s finances are healthy and stable, which is what you want in your local government.”