posted on October 19, 2013
(Beloit, WI) By Hillary Gaven, Beloit Daily News
Rock County has received solid credit ratings from Standard & Poor (S&P) and Moody’s. S&P reaffirmed the Rock County’s AA bond or credit rating and Moody’s issued its Aa1 rating. These ratings are linked to $6 million worth of new debt and existing debt valued at $40 million.
Typically AAA is the highest rating and D is the lowest. Bond ratings are a measure of the quality and safety of a bond, based on the issuer’s financial condition and its ability to pay back the debt on capital improvement projects, according to Rock County Economic Development Manager James Otterstein.
The better a bond rating is, the lower the interest rate the county will have to pay for any money it borrows. These lower interest rates lead to less debt service. And lower debt service means a lower cost to Rock County, which translates into less tax revenues needed to pay interest. Otterstein said the high bond rating also sends a positive signal out into the marketplace.
The credit ratings take into account the county’s financial management practices, as well as a host of economic indicators. While these rating agencies operate completely independent from one another, the criteria used to develop and then support their rating analyses share common themes. For example, both rating agencies referenced the county’s diversifying economic base, the number of positive economic indicators present and the county’s strong financial position and related management practices.
The area’s elevated unemployment rate and the property valuation changes among the county’s tax base were cited as challenging factors. These credit rating reports and a comprehensive Rock County economic development report are posted on the Rock County Development Alliance Web site (www.rockcountyalliance.com) within the “Market Data” and then “Economic Profile” sections.
The county’s residential and industrial properties are experiencing a resurgence, as measured by the percentage of total equalized property value attributed to these market segments. From a residential sales standpoint, 30 percent of all Rock County sales fell within the $200,000 to $399,999 range between January and July 2013. Foreclosures, particularly when compared to peer or neighboring Wisconsin and Illinois cities, were down considerably. Industrial vacancies were down, as well. Sales and Use Tax Collections were trending positively, with estimated year-end collections forecasted at $10.6 million.
Additionally, a summary of the last 12 months worth of countywide economic development activities were highlighted. Notable Beloit projects from that summary included the continued renovation of the Ironworks Campus, with special mention of Comply365, and other developments such as the Beloit Heath System’s Cancer Center.
The county’s report also included community specific data, covering topics such as residential and commercial/industrial permit activities, public works or infrastructure projects and references to the most recent local government and/or school district credit ratings. For example, the City of Beloit’s most recent rating was A+ (S&P) and the School District of Beloit was Aa3 (Moody’s). Lastly, the report included a list of the county’s largest public and private sector employers. This listing included a mixture of industry sectors, ranging from health care to manufacturing and education to wholesale.
The county’s 2013 full equalized property value is $9.3 billion, a figure that reflects a 2.7 percent average annual decline between 2008 and 2013. These declines, which are following statewide trends, are expected to stabilize in the near term given the recent trends of rising residential property valuations and modest new single family home permitting increases.