HUNTSVILLE, Alabama - Huntsville continues to enjoy a stellar reputation with the Wall Street credit rating agencies.
Standard Poor’s on Monday awarded the city its top AAA credit rating in advance of a $107 million bond issue to pay for new schools, wider roads and other public projects. Moody’s Investors Service assigned Huntsville its best-possible Aaa rating on Oct. 18.
Huntsville has maintained its AAA rating since February 2009. In their most recent reports, both Moody’s and SP say the Rocket City has a stable economic outlook.
City Finance Director Randy Taylor said the AAA rating is both a measure of Huntsville’s economic strength and city government’s financial management.
“Clearly, we’ve worked hard for it,” Taylor told AL.com Tuesday. “We’ve tried to put policies in place that insulate the city from economic risk and also use taxpayer dollars wisely.”
Mayor Tommy Battle and the Huntsville City Council deserve credit for “holding (tax dollars) back and taking positions that protect the city,” he said.
Moody’s said its rating reflects Huntsville’s “strong regional tax base and position as a major economic engine for northern Alabama,” as well as a “stabilized financial position with satisfactory reserve levels.”
The city’s existing debt load is “above-average but manageable,” Moody’s said.
Just 213 cities nationwide boasted SP’s AAA credit rating as of September 2012. Huntsville was the only one in Alabama. There were four in Tennessee (Brentwood, Franklin, Germantown and Bartlett) and three in Georgia (Alpharetta, Peachtree City and Roswell). Mississippi had no AAA-rated cites as of last fall.
Cities with a stellar credit rating command the lowest interest rates when borrowing money for new schools, roads and other projects.
In the coming days, Huntsville intends to borrow about $80 million for Huntsville City Schools and $27 million more for city projects including a new downtown connector road off Governors Drive, extending Weatherly Road to the future Grissom High School site, and relocating Fire Station No. 6 from Airport Road to Drake Avenue.
In addition to rebuilding Grissom, the city school system plans to construct a new northwest Huntsville high school on Pulaski Pike to replace 41-year-old Johnson High.
The school board recently voted to name the new high school for Decatur-born astronaut Dr. Mae Carol Jemison – a move that has angered Johnson High School students, alumni and supporters.