ScottsdaleAZ.Gov

Scottsdale continues earning high ratings on preserve bonds

  Sept. 21, 2009

  Contact: Pat Dodds, public affairs officer, (480) 312-2336

  SCOTTSDALE CONTINUES TO EARN
  AA RATINGS FOR PRESERVE BONDS

A national rating agency has reaffirmed one of the city’s key bond ratings, citing the city’s financial stability, strong financial management and “sufficiently conservative” revenue projections during a recession.

The Fitch ratings agency announced today that it is retaining the “AA” rating for $71.2 million in excise tax debt issued through the Scottsdale Preserve Authority. The SPA is a financial authority set up by the city specifically for the McDowell Sonoran Preserve. Bonds sold by the authority are paid through a portion of city sales tax revenues dedicated for the acquisition of property in the preserve, which now exceeds 11,000 acres and is targeted to grow to about 36,000, about one-third of the city.

Fitch noted that Scottsdale’s sales tax revenues have “declined markedly over the past year as the national recession has deepened.” However, the agency said the city’s ability to fund its debt payments is sound.

“Fitch believes that the long term prospects for Scottsdale … remain positive because of its demographics, economic diversity and appeal to businesses, tourists and outdoor enthusiasts,” the agency said in a news release.

It also noted that Scottsdale’s general obligation bond rating – for bonds backed directly by property taxes – remains at AAA, the highest possible rating. Scottsdale’s GO bonds have the highest possible ratings from all three major rating agencies.

“This is an affirmation of the City Council’s policies and management’s efforts to strengthen our long-term financial sustainability,” said City Manager John C. Little.