The City of Arcadia has secured the coveted AAA bond rating from Standard & Poor’s (S&P) with the outlook for the City as “stable.” The rating increase from AA+ to the highest rating of AAA is a reflection of Arcadia’s strong economy, budgetary performance and flexibility, and liquidity, but namely strong management, and solid financial practices and responsibility by City leaders.
“Our bond rating increase to an AAA rating, the highest rating possible, is evidence of our exceptional budgetary planning and solid financial management that has always set Arcadia apart from other organizations,” said Mayor Tom Beck. “We are looking to the future and making sure we have the resources available for what may come up unexpectedly, but at the same time, we thoughtfully consider how we spend those resources on a daily basis to make Arcadia the best community in which to live and do business.”
“Similar to an individual’s credit score, a bond rating measures the City’s ability to repay its debt. To receive AAA rating from S&P, typically given to the likes of U.S. Treasury Bonds, reflects a view that Arcadia has a very strong economy, improved property wealth, and strong management with good financial policies and practices,” said Administrative Services Director Hue Quach.
Bond ratings are a method of evaluating credit risk and the City’s ability to meet its financial obligations. The higher rating would allow Arcadia to borrow at lower interest rates which could potential save the City money in future borrowing costs. In the past, the City has issued bonds to finance the Police Department Headquarters in 2001 and the Santa Anita Bridge project in 2012. The bonds are repaid through property taxes.