Rating Agencies Reaffirm City’s Bond Ratings

By FALLS CHURCH OFFICE OF COMMUNICATIONS

July 20, 2011

Standard & Poor’s and Moody’s Investors Service have reaffirmed the City of Falls Church’s bond ratings of AA and AA1, respectively.  Bond ratings (expressed in letters from “AAA” to “C”), are grades given to bonds that indicate their credit quality.  Private independent rating services provide these evaluations of a bond issuer’s financial strength, or its ability to pay a bond’s principal and interest in a timely manner.

        The S&P report notes: “Standard & Poor’s considers the City’s financial management practices “strong” under its Financial Management Assessment methodology, indicating practices are strong, well embedded, and likely sustainable.”

        In reaffirming the City’s AA1 bond rating, Moody’s Investors Service is indicating it is also satisfied with the City’s financial management plan.

         “This positive affirmation from the rating agencies reflects the City’s careful financial planning and solid financial management practices, especially during the recent economic downturn,” said Mayor Nader Baroukh.  “One key to they City’s high credit ratings was the City Council’s decision to dedicate revenues for fund balance restoration in the FY11 and FY12 Budget.  This indicates the City is in a good position to move forward as the economy continues to recover. ”

According to the City Council’s Finance and Budget Committee members Johannah Barry and Ira Kaylin, “The ratings affirmation reflects the City’s commitment to sound fiscal management which balances needed revenues with expenditures, maintains bond issuance at prudential levels and above all else reflects our citizen’s willingness and ability to support the City. Though difficult to measure, citizen support is one of the most important factors in determining our rating.”