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James City County joined a small group of Virginia municipalities Tuesday when Moody’s announced it has bestowed upon the county a AAA bond rating.
Moody’s was the last agency to award the county a top rating. Standard & Poor’s and Fitch’s already rated the county AAA, the highest rating from both of those agencies. Fitch reaffirmed its AAA rating this week, and the county expects Standard & Poor’s to do the same.
With a top rating from each of the three agencies, the county is poised to save hundreds of thousands of dollars in the coming year on interest payments.
Michael Hipple (Powhatan), the chairman of the county’s board of supervisors, announced the rating on Tuesday. Hipple, who traveled to New York with a trio of county staff members last week to present the county’s case for a top rating to the agencies, said Moody’s specifically cited the recent 7-cent tax rate increase as a reason why it believed the county is poised for long-term financial success.
Moody’s also said the county is poised to grow in the coming years, lending further financial stability. It identified “solid fiscal management” and “conservative budgeting practices,” a large economic base with above average wealth, a sizable tourism sector and a manageable debt level as other reasons leading to the upgrade.
The bond rating serves as a credit rating for the county, so when it goes to borrow money to pay for major infrastructure costs, it gets a lower interest rate because of its high rating.
In the next six weeks, the county will go to refinance its current debts, it is projected to save hundreds of thousands of dollars, according to a county news release.
“The success of the triple-A rating is a tribute to the guidance of the board of supervisors and the leadership of County Administrator Bryan Hill,” Hipple said in the release, also citing Director of Financial Management Services Sue Mellen and the late John McDonald, who held the job before her.
During the meeting, Hipple heaped praise on Hill, the county staff and his fellow board members who supported the tax increase as the county worked to pass a budget for the fiscal year that began July 1 and runs through June 2016. Supervisor Mary Jones (Berkeley) was opposed to the tax increase all along and was the lone no vote.
“I want to thank those members who [voted yes] during an election year,” Hipple said, specifically citing Supervisors John McGlennon (Roberts) and Jim Kennedy (Stonehouse), who both voted yes and are running for re-election this year.
Kennedy said the county was at a point earlier this year that the county needed to act, and by voting yes on the increase, the board “did what needed to be done.”
“Last time we got [upgraded to a AAA rating by one of the other two agencies] we were told we’re in rare air,” he said. “I guess it’s a little rarer.”
Supervisor Kevin Onizuk (Jamestown) said he was proud of the county’s leadership team for the accomplishment.
Jones said she was “pleased” to hear about the rating increase.
“I, of course, want what’s best for James City County,” she said, noting she would have rather achieved the rating a “different way” but “this is how it moved forward.”
McGlennon said he shared the excitement, calling it a “tremendous success.”
“We went through a process that was very transparent, very clear and brought in an enormous number of citizens compared to other opportunities we have for citizen involvement, and they made it pretty clear they felt the case had been made,” he said. “It’s gratifying to see such a quick response.”
Hill, the county administrator, said in a statement his staff has “worked tirelessly” to earn the rating in the last 10 months.
“The news is a major step to show our fiscal strength as well as the board’s proactive approach toward ensuring James City County as a place for all to live, work and play,” he said. “I am honored to be a part of such a great county, a great team and I anticipate more great news as we continue to move our county forward.”