STAFF REPORT
The ratings service Standard & Poor’s has given Kyle a good grade – an A+.
The national rating service assigned its “A+” long-term rating and a stable outlook to Kyle for refinancing $14.2 million in debt, while also reaffirming the city’s “A+” long-term rating and a stable outlook on Kyle’s existing General Obligation debt.
“This affirmation by the rating agency is testament to the sound financial practices we’ve put in place,” said Kyle Finance Director Perwez Moheet. “We will need to continue to monitor the economic climate as we move forward to ensure that we are able to continue to improve the city’s financial standing.”
The debt being refinanced was issued primarily to fund the extension of Kyle Parkway east of Interstate 35 to Dacy Lane, which was an element in attracting Seton Medical Center-Hays to Kyle.
In addition to the hospital, two new professional buildings, Lowes Home Improvement, Walgreens and several other businesses have opened along Kyle Parkway’s extension, where Walmart is slated to break ground later this year.
City officials decided to refinance the debt in order to save $1 million in financing costs over the 17-year life of the bonds and also to level out debt payments over the next three years.
Had the city not refinanced, debt service payments were expected to spike.
“This is very good news for our city and (it) shows that we are continuing to be good stewards of the people’s money,” said Kyle Mayor Lucy Johnson.
In its evaluation to assigning the rating, the agency cited Kyle’s access to Austin’s diverse economy, a resilient tax revenue that weathered the national economic downturn and strong finances.
“We’ve made great strides recently in shoring up Kyle’s finances and improving our transparency as to how we budget and spend tax dollars,” Johnson said. “I certainly think a big round of congratulations is due to our city manager and his staff for their hard work and to our city council for their diligence in overseeing the budget process.”
