For Immediate ReleasePress Contact: Mary Kay Clunies-Ross, PIO, City Manager's Office, (510) 981-7008
CITY OF BERKELEY’S BOND RATING IMPROVES
Standard & Poor’s revised rating due to responsible spending policies and good fiscal management
Berkeley, California (Wednesday, January 02, 2008) - The City of Berkeley will be able to borrow money at a better rate than most other cities, due largely to the City Council’s responsible spending policies and the safe reserve the City keeps on hand for emergencies.
Standard & Poor’s, which provides credit ratings and other financial analysis, recently upgraded the City's general obligation bonds from AA- to AA, and the Certificates of Participation from A+ to AA-.
“This is good news for residents because it’s one objective measure of how the City is managing taxpayer dollars,” said City Manager Phil Kamlarz. “It doesn’t mean we have extra money to spend, but like a personal credit rating, it says that we’re making the right choices.”
Standard and Poor’s definition of an AA rating is: “The obligor's capacity to meet its financial commitment on the obligation is very strong.”
“The City’s improved bond rating is also worth noting because most municipalities in California are seeing their credit rating go down,” said Finance Director Bob Hicks. “Berkeley has had to make some hard choices when it comes to finances, and our Council has done a good job of keeping a responsible reserve in the face of that.”
When Standard & Poor’s revises bond ratings, it reviews the City’s financial statements, budget, and current debt, as well as many other economic and financial factors.