The city of Osceola was recently awarded an A+ bond rating from Standard & Poor’s, following a second rating call. This score was originally upgraded from A to A+ in 2014 and was affirmed last month. An A+ rating allows the city to acquire bonding to fund long-term infrastructure improvements to roads, drainage systems and other projects beneficial to the whole city at a lower interest rate. This will potentially save the residents of Osceola millions of dollars in tax payments in the future.
“The city’s bond rating is the result of a collective effort by Council, management and staff to establish and maintain strong budgetary standards and planning practices,” said Ty Wheeler,City Administrator for Osceola. “The City’s 2012 comprehensive plan and subsequent capital improvement programs help the City Council balance prioritizing projects with available financing. City leaders are not only looking at how dollars spent now affect this year’s budget, but also what happens five or ten years into the future. An A+ bond rating allows the city to borrow money at a lower interest rate. As a result, fewer dollars are spent servicing debt.”
A city’s bond rating is determined through an evaluation of the economic well-being of a community through its Median income, concentration or dependence on certain employers or industries, diversity of tax base, rate of population growth, average age of the community, and other factors. A bond rating is not determined by a city’s past but by looking at its future and its ability to repay bond revenue.
Municipal bonds are an investment opportunity for individuals and a reasonable long-term option for obtaining funds to make needed community improvements. Having a good bond rating allows market participants to evaluate the risk of purchasing bonds quickly and is the rating agency’s opinion as to the creditworthiness of the city.
An A+ rating is a very good investment grade and an excellent assessment of the bright future of the city of Osceola.
For more information, contact Ty Wheeler, City Administrator, City Of Osceola, Iowa, 115 North Fillmore, Osceola, IA 50213, phone: (641) 342-2377, fax: (641) 342-4005
This article was first published on http://clarkecountylife.com.