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MAYOR HANNEMANN: CITY BOND RATINGS REMAIN STRONG, STABLE

 

(Wednesday, Nov. 4, 2009)—Mayor Mufi Hannemann announced today that the nation’s three major national rating agencies have reaffirmed Honolulu’s high “AA” bond ratings stable financial outlook, despite the national economic slump.

 

            “We truly appreciate this official acknowledgment of our careful and prudent fiscal management practices,” Hannemann said. “Managing the public’s money wisely is a responsibility we take very seriously, and continues to be a hallmark of this administration. I’m grateful that the City and County of Honolulu is a state leader in ensuring fiscal accountability.”

 

            The ratings examination was conducted to assess the creditworthiness of the City and County of Honolulu prior to its offering for sale approximately $234.7 million in General Obligation bonds. The pending bond sale will include $140.3 million to finance the expansion of the H-Power garbage-to-energy facility, $50.5 million for various other City construction projects, and $43.9 million to refund previously issued general obligation bonds and achieve debt service savings.

 

In affirming its rating, Moody’s Investor Services reported that Honolulu’s “…Aa2 Rating primarily reflects the city’s sizable economic base despite recent recessionary pressures, above average resident wealth, sound financial operations that will face growing budget pressures over the near-to medium-term, and a manageable debt profile….Moody’s expects that the city will continue to make the necessary budgetary adjustments to maintain financial stability.”

 

Moody’s further noted that, “…management’s commitment to maintaining budget balance and adequate reserve levels has been an important factor in Moody’s credit evaluation of Honolulu.”

 

 Fitch Ratings reported that, “The ‘AA’ rating reflects the city’s sound financial position and low debt burden. .... Financial operations are still sound, as the city continued to raise revenues and cut spending in fiscal years 2009 and 2010.  Fitch Ratings expects that the city’s continued willingness to raise recurring revenues, as well as implement prudent spending decisions, will enable the city its solid fund balance levels.”

 

And Standard & Poor’s Rating Services found that Honolulu continues to show “strong financial performance and reserves; and (a) moderate debt burden and affordable property tax rate.”

 

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Media contact: Bill Brennan, Mayor’s Office, 768-6928