Moody’s Assigns Rare Aaa Rating to City of Coronado


CORONADO, CA
 - Moody’s Investors Services has assigned a Aaa credit rating, the highest credit rating issued, to the city of Coronado for its exceptionally strong financial position evidenced by ample reserves and the absence of any outstanding debt.

Coronado joins just eight other California cities – including Beverly Hills, Newport Beach, and Palo Alto – and has become the only city in San Diego County to hold the Aaa rating.

In a review of Coronado conducted earlier this year, the credit rating company issued a report April 30 citing the City’s stable and moderately sized tax base, above average wealth levels, and favorable debt position as the basis for issuing its initial Aaa rating.

According to Moody’s, Coronado “maintains a healthy financial position with conservative budgeting and the setting aside of various reserves to address ongoing capital expenditures, unforeseen economic emergencies and downturns as well as the additional funding of ongoing pension liabilities.”

“This rare rating demonstrates Coronado’s financial stability and high standing among hundreds of municipalities in California, particularly for a city of our size,” said City Manager Blair King. “We have been monitoring and implementing best financial practices, such as advanced pension payments, creation of a post-employment benefits trust, designated reserves, and starting a major facilities replacement fund. This is validation from a respected source.”

Moody’s noted that Coronado has “grown its General Fund position to $68 million or an exceptional 149.5 percent of General Fund revenues as of fiscal year 2013, in addition to the various additional reserves demonstrating significant financial flexibility.”

The report pointed out the city’s consistent operating surpluses over the past five consecutive years through conservative budgeting practices, as well as a $5 million payment to CalPERS in addition to its annual required contribution toward its unfunded pension liability.

Moody’s said Coronado benefits from its close proximity to downtown San Diego and the greater San Diego region. It added that while much of the city’s economy is tied to tourism, “the local tax base gains incredible stability from the residential nature of the city as well as the stabilizing presence that the Coronado Navy Base provides.”

Moody's noted Coronado's $6.9 billion tax base was “a relatively limited overall tax base, given the median level for Aaa rated cities in California is $22.5 billion.” However, the report noted that Coronado falls in line with the median $6.6 billion tax base for Aaa cities nationally. Moody's said "impressively, the city tax base never contracted through the economic downturn and the five year average annual growth rate for the city is 2.7 percent.”

Coronado underwent Moody’s highly critical, intense analysis of its financial records to obtain an independent analysis of its current fiscal condition. Moody’s follows a set of rigid standards when ranking an agency’s creditworthiness.

Read Moody’s press release. The complete Moody’s Ratings Update is available online to subscribers at Moodys.com or to journalists by contacting Moody’s at (212) 553-0376.

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Tags: city of coronado, finance

Comment by Kathy Schafer on May 1, 2014 at 10:45am

Wow I guess the sky isn't falling after all!

Comment by Buzz Fink on May 1, 2014 at 12:48pm

Hmmmm.  I guess Barbra Denny's conspiracy theory now extends to Moody's.

Comment by MIKE GAPP on May 1, 2014 at 6:39pm

Boy, I sure hope you guys are right.

Some people will believe anything that fits their agenda.

Excuse me, while I Kiss The Sky.

http://www.youtube.com/watch?v=VFHPgoZlSWY

I'm not one to call things conspiracies where it's just plain old greed, corruption, nepotism, class warfare, lack of accountability, and self-interest in evidence.

....Takers gonna take....

Oh, while I've got you again, so to speak...; ...Huh, look here, more facts to be dismissed as nut job hearsay...;

Moody's seems have been settling out of court instead of defending themselves quite a bit lately.

Wonder what that means? I can't wait to note who objects, that should be telling....

Moody's Lawsuit Settlements

http://www.bloomberg.com/news/2011-10-14/moody-s-s-p-fitch-settle-c...

STRIKE ONE! October 2011 - Moody’s reached a settlement resolving claims by the state of Connecticut that the credit rating company unfairly gave lower ratings to public bonds.

http://www.bloomberg.com/news/2012-07-24/moody-s-settles-with-share...

STRIKE TWO! July 2012 - Moody’s said it reached a settlement with stockholders in lawsuits filed over structured finance ratings.

http://online.wsj.com/news/articles/SB10001424127887323789704578447...

STRIKE THREE - YOU ARE ...uh ...still with us evidently! April 2013 - Moody's reached a settlement avoiding what would have been their first jury trial over crisis-era ratings. The fourteen plaintiffs, were led by Abu Dhabi Commercial Bank and King County, Washington. They claimed lawsuits filed in 2008 and 2009 that Moody's misled them by allegedly inflating ratings on two so-called structured investment vehicles they purchased.

....And 2014 is still young....

Come on.

- Even in this obvious game of PROP E Fast PitchTHREE STRIKES should mean you are out and irrelevant.

(Picture me helpfully waving at the three strikes above, if that helps.)

What Moody's is really saying is that Coronado can be taken advantage of with more security than other municipalities in this broken economy, because this is where the Wealthy run to, pricing out the military, etc., as they have for years.

There's a lot more strikes than that evidently.

Don't hafta TAKE my word for it.

....Takers gonna take... your money.

Thanks for your time.

NO on PROP E.

Mike Gapp

Comment by Kathy Schafer on May 1, 2014 at 7:40pm

We're not talking about Prop E here.  LOL...I'm sure if Moody's downgraded Coronado you'd be calling them geniuses.  

Comment by Erin Grady Brown on May 1, 2014 at 10:31pm

Good grief.

Comment (keep it clean & on topic)

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