News Release
HRM's Bond Rating Remains Solid
(Wednesday, January 7, 2004)-- Eighteen months after receiving its first bond rating, HRM has once again been awarded with an "A/Stable" rating from the international bond rating agency, Standard and Poor's. The rating follows a recent independent review by the international agency of HRM's financial picture and credit quality.
"The continuing solid rating granted HRM by Standard and Poor's is a result of the ongoing efforts of staff and Council to prudently manage the finances of the municipality. Our Multi-Year Financial Strategy and our giving careful consideration to the long-term impact of each decision are both a part of this," George McLellan, Chief Administrative Officer, said.
In its release Standard and Poor's linked its rating in part to both past fiscal performance and the outlook for the future.
The release states "The rating reflects a robust financial performance in fiscal 2003 (year ended March 31), steady economic growth, a liquidity position that has strengthened dramatically since 1999, and a total municipal debt burden that is moderate by peer comparison."
The release went on to say that 2003 was a "stellar year for building permits and housing starts in the Halifax Region, boding well for continued growth in the taxable assessment base."
"The timing of this news is ideal as a report will be in front of council in late January recommending the best source of direct, long-term financing for the Harbour Solutions Project. Council can make their decision with the knowledge that HRM retains a strong rating and solid credibility in the marketplace, even after taking into account the financial impact of the borrowing required for Harbour Solutions, Mr. McLellan said.
While the "A/Stable" rating is good news for HRM, there are still financial challenges ahead for the municipality. There is a pressing need to renew and replace aging infrastructure and to add new infrastructure to meet the needs of our growing population. This work represents a capital funding gap of $40 - $50 million annually.
"That's money we don't have, but need to spend to bring our assets and infrastructure to the level of comparable cities," he said.
"We've worked hard to ensure we live within our means. The reward is a credit rating that further benefits the taxpayers of HRM," Mr. McLellan concluded.
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For further information, contact:
George McLellan
Chief Administrative Officer
(902) 490-4026
Dale MacLennan
Director, Financial Services
(902) 490-6308
Stephen Ogilvie
Standard and Poor's
(416) 507 2524
