Uncle Sam may be adjusting to life with a lower debt rating, but the city of St. Louis has no such worries for the moment. Moody's has affirmed the city's general-obligation rating of Aa3, and said today that the city's ratings outlook is stable.
The ratings service's report (registration required) said St. Louis' strengths include a strong tax base, a rejuvenated downtown and a relatively conservative debt profile. As "challenges," it cited weak income levels and high unemployment, and a multi-year decline in the city's general fund balance.
Moody's also mentioned this spring's earnings-tax election, in which 87 percent of voters decided to keep the tax in place for five more years. The report says: We believe this demonstration of strong voter support bodes well for the future stability of the city's main source of operating revenue.
Moody's said the rating could rise if the city's "socioeconomic profile" improves, or could decline if population and property values continue to fall. |
