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City Responds to Change in Moody’s Rating

Port Saint Lucie City1

Despite Moody’s Investors Service’s recent announcement regarding the rating company’s downgrade of Port St. Lucie’s general obligation bonds and certificates of participation (COPs), City Manager Jeff Bremer remains confident in the city’s financial outlook.

 

Two other major ratings agencies, Standard & Poor’s and Fitch, have not downgraded the city’s bonds and COPs. Both companies retain their AA- rating for Port St. Lucie, with Standard & Poor’s defining the rating as “Very strong capacity to meet financial commitments.”

 

“Though the Moody’s downgrade may lead to higher borrowing costs in the future, we are still confident in the city’s long-term financial picture,” said City Manager Jeff Bremer. “We have a plan to address our debt and are managing it appropriately. Our city will continue to provide the top-notch services our residents are used to, and we continue to do it efficiently and effectively every day.”

 

While Moody’s said the bond rating downgrade from Aa3 to A1 and the COP rating change from A1 to A2 reflects among other factors the potential risks associated with the debt on the city-owned Vaccine and Gene Therapy Institute’s facility, the agency also noted several strengths such as the city’s adequate reserve levels, a large tax base with growth potential and a modest pension burden.

 

“This action by Moody’s underscores the importance of the city’s ongoing efforts to address deficit spending in the general fund, spending directly related to failed economic development investments made in the past,” said Bremer.

 

See Standard & Poor’s most recent rating announcement

See Fitch’s most recent rating announcement

See Moody’s report issued June 11

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