Madison Maintains Moody’s Superior Bond Rating

Moody’s Investor Service has continued Madison’s Aaa bond rating with a stable outlook. The rating is for the $99.1 million in tax-exempt and taxable general obligation bonds and notes that will be issued by the City next week. This is the highest possible rating an issuer can receive. It affirms the City’s sound financial and budget management, conservative debt repayment structure, stable economy relative to the state and nation, and solid general fund reserves.

"It is very reaffirming to receive the Aaa Bond Rating again," said Mayor Paul Soglin. "My office, city staff and Common Council members all work very hard to maintain this high rating and we are committed to maintaining it despite the continued restraints we are facing. As budget discussions continue, the City is determined to maintain this level by enacting another responsible budget for 2017."

Moody’s cited a stable and diverse economy, sound financial operations and a history of healthy reserves as well as a manageable debt burden among the City’s strengths. Analysts noted, however, that challenges include strict levy limits that reduce the City’s revenue raising flexibility for operations. The service also noted that sound financial operations benefit from strong budgetary control and stable reserve levels. They report that the City’s sound financial profile is expected to continue due to consecutive operating surpluses and the presence of healthy reserves.

The rating confirms market confidence in the City’s economic condition and the Mayor and Council’s fiscal management. Moody’s identified three conditions that could change the rating down in the future – significant increases in fixed costs, including debt service, weakening of the City’s tax base, and material declines in operating revenues.