Good credit
By T&D Staff Monday, June 23, 20086 comment(s) | Default | Large
A good credit rating is just as nice for a county as it is for its residents.
Orangeburg County borrowed $9.7 million this week for various county projects. Because its credit rating improved, with three rating agencies giving it A-range ratings, the county got a better interest rate on its loan -- and that will save it money over the long run.
The county had anticipated borrowing at 3.96 percent, County Administrator Bill Clark said. Instead, it got a rate of 3.78 percent, saving it $184,000 in interest over the life of the loan.
“Those are indications of the financial strength of the county, as rated by the three agencies,” said Orangeburg County Administrator Bill Clark. “I’m very pleased with them, especially the Standard and Poor’s rating.”
The money will be used to purchase vehicles and equipment for various departments, including emergency services and law enforcement; to prepay outstanding equipment lease obligations; to acquire approximately two parcels of land totalling 183 acres that will be used for a new industrial park and to expand an existing park; to extend and improve utilities at the John W. Matthews Industrial Park in the eastern part of the county; and to pay the costs of the bond issuance.
The three agencies that rated Orangeburg County’s bonds all gave it what could be considered upper-medium ratings, Clark said. Standard and Poor’s increased Orangeburg County’s credit rating from a BBB+ to an A, while Moody’s rated the county at A3. Fitch Ratings, rating Orangeburg County for the first time, gave it an A-.
Clark said the agencies looked at things like the county’s economic conditions and future, fund balance and audit in grading the county’s bonds.
In a press release explaining its rating, Fitch found much to like about the county, plus some concerns.
Fitch found the county has “below average” economic indicators, such as a high-than-average unemployment rate.
But it found good news on the horizon, with Dubai World’s plans to build a logistics park in the county. Dubai World has invested $10 million in 130 acres in eastern Orangeburg County, and has said investment at the site could reach between 6,000 and 10,000 jobs and $600 million in investment over five to 10 years.
And the rating agency found, “Orangeburg County’s financial position remains sound despite recent drawdowns in fund balance.”
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thelower40 wrote on Jun 30, 2008 11:20 PM:
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