Bowie Earns Highest Bond Ratings

From City of Bowie: Moody’s Investor Services and Fitch Ratings reviewed the City of Bowie’s financial situation recently and concluded that the City still deserved their highest bond ratings. These ratings were reaffirmations of prior assessments by the agencies.

Both agencies noted strong fiscal management, a diverse regional economy, low debt, substantial reserves, and a predictable revenue stream as being factors in their ratings. The Moody’s announcement, which was made on March 2, 2017, said that, “Bowie's credit position is outstanding, and its Aaa rating is notably stronger than the median rating of Aa3 for cities nationwide. Key credit factors include a robust financial position and a small pension burden with an exceptionally low debt liability.” Fitch Ratings announced a AAA rating for the City of Bowie on March 14, 2017. The Fitch assessment noted that, “The City retains an exceptional capacity to manage risks associated with a normal economic cycle given the combination of its substantial reserves, prudent budgetary management, and legal revenue-raising capacity.”

H. Byron Matthews is director of the City’s Finance Department. He credits careful management of expenses and a keen eye on the bottom line across the organization, as key reasons for the City’s continued financial success. Mayor G. Frederick Robinson echoed the Council’s strong emphasis on careful spending in his 2017 State of the City Report when he said, “We remain in excellent financial shape, due to careful budgeting and management. My colleagues and I recognize the importance of setting priorities, formulating budgets based on those priorities, and then living within the limits we set.”

Bond ratings are important indicators of an entity’s economic health and ability to withstand financial challenges. They also influence the cost of borrowing; a top bond rating allows the City to sell bonds at a low interest rate. This will be important as the City issues bonds to pay for a portion of the planned indoor sports facility.

The statements from Moody’s Investor Service and Fitch Ratings are attached to this press release.

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