Fitch rates Seattle's $84.5M bonds AA+
Puget Sound Business Journal (Seattle)
Fitch Ratings has given its AA+ rating to the city of Seattle's $84.5 million limited general tax obligation bond offering because of the rebounding economy and the city's financial management.
However, those positive trends are partially offset by current and anticipated limitations on tax revenue, Fitch said Friday. The rating is the firm's second highest after AAA.
Seattle's bond rating was buoyed by the economic recovery, the credit rating agency said. Retail trade is strong, assessed values are rising and jobless rates are lower.
Fitch also attributed the favorable credit rating to growth in Seattle's general fund and the city's low debt burden, which is largely a result of its "pay-as-you-go" capital program.
Nonetheless, Seattle will have to contend with "the severe constraints" imposed by Initiative 747, which limits the increase in property tax collections to 1 percent annually. Seattle also could get less revenue from business-and-occupation taxes beginning in 2008, when a statewide change in the allocation of corporate revenue takes effect.
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