Released By Osceola County Community Outreach/Public Information Office
Two economic research companies recently reported favorably on Osceola County’s finances.
Fitch upgraded $110.75 million in capital improvement revenue bonds to AAA from AA. The AAA rating is the highest possible.
Meanwhile, S&P Global Ratings raised its rating on the County’s limited general obligation (GO) debt one notch to ‘AA’ from ‘AA-‘.
“This is very good news and is once again confirmation that Osceola County government continues to operate in a fiscally responsible manner,” said Commission Chairwoman Cheryl Grieb. “This sustained success is a tribute to our strategic planning and sound management principles. This common sense approach continues to garner praise from financial professionals and should encourage confidence in the economic future we are creating for our citizens.”
The Fitch upgrade reflects the very high coverage cushion from existing pledged revenues in the context of the revenue stream’s low volatility, which partially reflects certain policy actions…from which the pledged taxes are derived, Fitch analysts noted.
The company also affirmed its AA- rating of another $115 million in sale tax and infrastructure sales tax revenue bonds. The rating outlook is Stable.
“Efforts to diversify the economy and attract higher wage jobs are evident, including the county’s collaboration with nearby higher education institutions,” analysts noted. “The economic and population expansion taking place within the county should continue to benefit the various dedicated tax revenue streams pledged to its outstanding revenue bonds.”
Meanwhile, S&P Global Ratings affirming the stable outlook on GO debt. The stable outlook reflects S&P Global Ratings’ opinion the county’s very strong management and conservative financial policies will likely allow management to maintain very strong reserves. The county originally issued the series 2010 bonds to fund environmental projects, supporting the environmental lands conservation program.
“We rate the limited-tax GO debt on par with our view of the county’s general creditworthiness, as well as the ad valorem tax not being derived from a measurably narrower or different tax base, there being no evidence of management not supporting obligations with available resources, tax collections remaining strong, and there being Rno limitations on the fungibility of resources. Overall, these factors support our view of the county’s overall ability and willingness to pay debt service,” S&P wrote. The company also noted “the county’s very strong budgetary flexibility.”
The ratings are important because they are an independent, unbiased analysis of the credit quality and fiscal management of the County over an extended number of years.
Companies such as Fitch and S&P provide international financial research on bonds issued by commercial and government entities. The companies rank the creditworthiness of borrowers using a standardized ratings scale which measures expected investor loss in the event of default.