November 1, 2011 - $5.2 million in lease revenue bonds for technology and forestry equipment were issued today, November 1, 2011, at an interest rate of 3% according to Moody’s Investors Service. More than half a billion dollars in outstanding general obligation debt will remain at the same low interest rate, because of the City’s ability to maintain its AAA bond rating, saving taxpayers millions of dollars annually.
In the latest report from New York, on October 28, 2011 Moody’s cites “the City’s sizable and stable economy that has weathered the national downturn more favorably than its counterparts in other portions of the country,” as the rationale for continuing the AAA rating and low interest rate.
Standard and Poors credits the Suttle Administration’s “conservative budgeting practices” with helping the city “regain structural balance.”
While Standard and Poors allowed Omaha to keep its AAA rating with a stable outlook, Moody’s is in the process of considering whether to remove the negative outlook assigned to Omaha’s AAA credit rating. Removing the “negative outlook” from Omaha’s rating lessens the City’s chances of being downgraded in the months ahead.
“We are pleased that these bond rating agencies appreciate the tough financial decisions we have made in a bad economy,” said Mayor Suttle. “Companies such as Moody’s and Standard and Poors look at several aspects of how a city manages its finances in determining a city’s credit rating and our budget decisions over the last two years reflect solid financial stability.”
Friday’s report specifically warns that failure to continue making progress towards funding long term pension liabilities and an inability to negotiate terms of the fire contract could have a negative impact on Omaha’s rating.
