S&P increases Allegheny County bond rating
By Aaron Aupperlee
Published: Tuesday, Jan. 28, 2014, 4:36 p.m.
Standard & Poor's bumped up Allegheny County's bond rating one notch, from an A-plus to a AA-minus, the ratings agency said on Tuesday.
It is the highest the county's bond rating has been in nearly 12 years, county officials said in a news release highlighting the increase.
S&P's outlook for the county's finances remains “stable.”
An upgraded bond rating could lower the county's borrowing costs. The county last issued bonds in July, seeking up to $225.8 million.
County Executive Rich Fitzgerald said the rating change was in response to an increase in the county's cash reserves, reduced reliance on one-time revenue sources and transportation funding and pension legislation that lawmakers approved in Harrisburg.
The Port Authority of Allegheny County is expected to receive 22 percent of the money slated for transit in the $2.3 billion transportation funding plan passed in November. A pension bill signed Dec. 23 could save taxpayers $1.1 billion over 50 years. The so-called “anti-spiking” bill caps the amount of overtime pay employees on the verge of retirement can count toward their pension.
Linda Yip, a credit analyst at S&P, said the county will have to continue to control costs and find new revenue to grow its cash reserves while supporting operations. Yip mentioned weak budgetary flexibility and a largely unfunded pension liability as roadblocks to the agency's increasing the rating further.
Aaron Aupperlee is a staff writer for Trib Total Media. He can be reached at 412-320-7986 or aaupperlee @tribweb.com.
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