(June 1, 2018) For the first time in its history, the City of Frisco has received the highest municipal bond rating possible, translating into financial savings for Frisco in the form of lower interest rates.
Moody’s Investors Service upgraded the city’s bond rating to Aaa from Aa1, citing Frisco’s “healthy revenue growth” and “strong fiscal position”. The Aaa rating demonstrates the strongest creditworthiness relative to other U.S. municipal or tax-exempt issuers or issues.
City leaders received word yesterday, May 31, about the bond rating upgrade. George Purefoy, City Manager, noted it’s an achievement that has been on Frisco’s ‘wish list’ since he was hired in 1987. He credited Nell Lange, Assistant City Manager as well as Anita Cothran, Director of Financial Services, and her staff for the milestone accomplishment.
“I can tell you for certain that without the outstanding leadership of Nell, Anita, and their great team Frisco would not be at this point in its financial history. I will never be able to thank them enough for the great job they have done with the city’s finances,” said Purefoy.
“We’re thrilled,” said Cothran. “Just last week, the (U.S.) Census named Frisco the fastest growing city in country. High growth cities typically have more debt. This means, despite our growth, Frisco has a strong economic base. We’re being recognized for debt management, healthy reserves, and sound financial practices. We’re very proud of our team.”
Lange noted Moody’s also recognized Frisco’s proactive financial management practices to increase its operating expenditure reserves or ‘rainy day fund’.
“Increasing reserves is a City Council priority,” said Lange. “Our city policy sets the goal at 25%. We’re proud to have ended the last fiscal year (FY17) with 43% in reserves. We couldn’t do that without council leadership, specifically the Budget and Audit Committee.”
“This means lower interest cost on our debt, but more importantly it’s a great barometer of the financial health of the city,” said Will Sowell, Chairman, City Council Budget and Audit Committee. “This rating puts Frisco in an elite class of (the most populous) cities. Officials with Moody's tell us only 8.4% of cities have a Aaa rating, which is the highest.”
“Long-term financial health has been one of the City Council’s strategic focus areas for many years,” said Mayor Jeff Cheney. “Achieving the highest bond rating possible helps our city be well positioned for the phenomenal growth we’re experiencing – and have been experiencing for decades. It also strengthens our ability to plan for -- and provide high quality city facilities and amenities for our residents, businesses and visitors. We couldn’t be prouder of our team.”