County Retains High Credit Rating, Helps Save $9 Million

York County’s high credit rating will help save taxpayers approximately $9 million when it refinances a 2006 bond issue next year.

Standard & Poor’s recently reaffirmed the County’s AA Stable rating following a review of its financial position and management practices. “AA” is the second-highest range of ratings within Standard & Poor’s scale.

The move bodes well for taxpayers because such a high rating helps to reduce interest rates for public projects undertaken by the County. The County’s credit rating was upgraded from AA- in 2010.

A combination of the strong credit rating and a favorable financial climate will lead to lower interest rates – and about $9.1 million in taxpayer savings - when the County next year refinances about $59 million from a 2006 bond issue.

The Board of Commissioners approved the refinancing today as part of an ordinance that also authorized an additional $14.84 million in bonds to finance the County’s new 911 radio project and the build-out of the Judicial Center’s fifth floor.

“Credit ratings may not make for the most tantalizing news, but they have a real, long-term impact on taxpayers,” said Commissioner Doug Hoke. “This AA rating represents years of work and quiet dedication by our administration to strengthen the County’s financial position.”

In determining its rating, Standard & Poor’s cited the County’s:
• Financial management policies
• Budgetary performance
• Budgetary flexibility
• General Fund reserves
• Liquidity
• Local economy
• Debt and contingent liabilities

Commissioner Chris Reilly said the high rating reflects sound decisions made by the County in the face of the recent economic downturn.

He pointed to management of the County’s pension fund as an example. Although it lost millions during the downturn, wise investment strategies have propelled it to become one the best-performing public pension funds in the Country.

The fund was valued at $311.2 million at the end of September, up more than $131 million compared to five years ago.

“This rating from an agency like S&P validates our administration’s strong financial management practices and our response to historically difficult conditions,” Reilly said. “Despite a stagnant housing market and funding cuts from the state and federal government, we’ve maintained a strong financial foundation. That’s a big part of how we’ve been able to go four out of the last five years without a tax increase, and are proposing no tax increase again in 2015.”

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