Dec. 7, 2011 – Omaha Mayor Jim Suttle and City Finance Director, Pam Spaccarotella’s efforts to remove the negative outlook assigned to the city’s AAA bond rating by Moody’s Investors Service in August, paid off today with the restoration of its stable outlook. The Suttle administration traveled to Chicago in September to make an appeal to the bond rating agency in person, asking Moody’s to restore Omaha’s good standing despite the federal government’s credit rating downgrades.
The City of Omaha’s Finance Department was notified August 4, 2011 that Moody’s Investors Services assigned a negative outlook to the City of Omaha’s AAA rated General Obligation bonds. “This notification was a result of Moody’s announcement that the AAA rating of the U.S. government had been assigned a negative outlook,” said Finance Director, Pam Spaccarotella. “In order to keep Omaha taxpayers from paying $5-6 million in higher interest, we thought it was important to make Moody’s aware of this administration’s strong commitment to responsible financial management. Bond rating 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, very much like how your personal credit score is determined. ”
“We cut spending in city government through performance based budgeting and balanced our budget in spite of millions of dollars of cuts in aid from the state and federal government,” said Mayor Suttle. “This year we continued to create efficiencies that greatly improve the administration of vital city services to our citizens, without tax increases and established a plan for building financial reserves. These accomplishments demonstrate that we have the political will to plan for the future while rising above the dependence of outside assistance to keep our community solvent.”
The City of Omaha’s General Obligation bonds were assigned a AAA rating with a negative outlook nearly 4 months ago along with 177 other local governments. Moody’s specifically stated that the outlook was moved to negative with a group of issuers identified as indirectly linked to the U.S. government rating based upon certain shared characteristics. Moody’s further stated that they would continue to evaluate each outlook on a case by case basis. Today Omaha officially restored a stable outlook to its AAA bond rating.
