Standard & Poor’s has reaffirmed the City’s A+ Credit Rating and revised the City’s outlook to “positive” from “stable” based on a number of factor’s including the local economy.
“This is really great news,” said Carol Busch, City Treasurer & General Manager – Finance & Corporate Service. “Adhering to the approved financial guiding principles, including a prudent financial plan, allows the City to make decisions that will foster a healthy and sustainable community.”
A city’s credit rating is used by investors and creditors to measure a municipality’s ability to meet its financial obligations. This is good news for residents because a good rating allows a municipality to borrow money at competitive interest rates and to pass on the lower costs to taxpayers.
In its June 2012 rationale, Standard & Poor’s said: “The positive outlook reflects Standard & Poor’s expectation that, in the next two years, Thunder Bay’s financial risk profile will remain healthy, with robust liquidity and solid operating surpluses in excess of 5% of operating revenue with modest after-capital deficits.”
The rationale behind the rating explained that Thunder Bay’s economy focuses largely on the public sector (more than 20% of total employment), which provides it with a stable economic base.
Bombardier Inc., a major player in the manufacturing sector, has secured long-term contracts to produce subway cars, and the city has also made some gains in diversifying the economy into other noncyclical fields, particularly in knowledge-based sectors such as biomedicine, research, and health care.
More information is available on the City’s website: www.thunderbay.ca/performance.
