It wasn’t something that made the news and may not seem very glamorous to most of you reading this, but something very exciting happened in your City last Friday, July 12th!
The City of Ozark completed a process to obtain its first financial rating, which is a national rating from Standard & Poor’s Rating Service that dictates the interest rate the City will be able to borrow money at for future capital improvement projects. I am extremely proud to be able to report that as a result of our adopted budget philosophies, budgeting processes, and excellent budget management over the past five years, the City of Ozark has been rated with an “A+” overall rating for future General Obligation (GO) bonds and an “A” rating for future Certificates of Participation (COP) loans.
This first ever bond rating process was initiated as a result of the City’s upcoming $12.5 million dollar Water System Improvement Project estimated to span over a five-year completion period. Financing strategy discussions for the project began several months ago with our Bond Underwriters and Bond Council, and over the past two months included many conference calls with the bond purchasing agency (UMB Bank, Chicago) and our rating service of Standard & Poor’s. It took weeks, days and many hours of staff working diligently to gather the necessary data, update our portfolio criteria, and present the information necessary to move us through the rating process quickly so we could obtain our rating before interest rates crept higher in the Bond market. Also, going through the process helped identify two more refinancing opportunities from past projects including the Quail Run Water System Improvements (year-2002) and the 2005 relocation of our existing Police Dept. Offices.
Although evaluating the City’s financial position is a never ending management objective of the City Administrator and Finance Department, I would be kidding you if I said that in the beginning of our first rating process I wasn’t a bit concerned with our overall picture. Taking into account the past five years of economic slow-down, increases in our operating expenses such as fuel, electric rates, asphalt/oil, concrete, etc., and the current balance of the City’s capital improvement debt portfolio, we couldn’t be sure how the rating service would view our overall financial position. That being said, it has now been validated that our consistent adherence to budget policy, accurate documentation, and sound budget management practices have exhibited an excellent stewardship of the Public’s dollars, as well as established a favorable financial position for the City to be able to accomplish future capital improvement projects under the best financing terms available to us as a municipality.
We are all very pleased with the City’s first financial rating and the process itself was a valuable learning experience. Also important to note is that our building permit numbers continue to increase, our budget is balanced, and your capital improvement projects are on track and on budget. If you have any questions about the rating process mentioned above or any other project related to the City please don’t hesitate to contact the City Hall at 581-2407. I am happy to share any information with you and look forward to continuing to serve your interests.
Respectfully,
Steve Childers,
Ozark City Administrator