County Receives an AAA Bond Rating

Montgomery County was recently given an AAA bond rating from Moody’s Investor Services.

The county was originally given the rating with a possible downgrade “due to the federal government’s credit rating and how that might relate to county finances,” according to a county press release. 

Director of Communications John Corcoran said the caveat has been removed, and the rating remains an AAA with “a negative outlook.”

Corcoran said the most important thing, however, is that the county has the highest rating of AAA. According to “Moody’s Rating Symbols and Definitions” on www.moodys.com, “obligations rated AAA are judged to be of the highest quality, with minimal credit risk.”

The negative outlook is due to the county’s fund balance and the unappropriated funds in the balance going down over the years, Corcoran said.

Corcoran said the AAA rating means that the county can borrow money at the lowest cost possible, which is beneficial for taxpayers, as less money will be needed to repay the bond. All forms of government can request ratings to borrow funds when they look to borrow money for capital needs such as open space or long-term investments, he said.

The county looked for Moody’s rating “in anticipation of a $35 million bond issue to refinance the existing debt,” which the commissioners will vote on at tomorrow’s meeting, according to the press release.

Corcoran said the county received the high rating because of its financial health.

“We have an outstanding financial reputation,” Corcoran said.

He said Moody’s looks at a number of things before giving a corporation or government a rating, including its level of indebtedness and financial history.

“Montgomery County’s finances are as sound as they have ever been,” said Montgomery County Commissioner James Matthews in the press release.