Moody’s Investors Service has upgraded the City of Springfield, TN’s issuer and general obligation unlimited tax (GOULT) ratings to Aa2 from Aa3. Concurrently, Moody’s has assigned a Aa2 rating to the city’s proposed $12.995 million General Obligation Public Improvement Bonds, Series 2023. Following the current issuance, the city will have an estimated $65 million in outstanding GOULT debt.
Moody’s, in its review of the city, further referenced the bond rating “reflects a continued strengthening of the city’s financial position marked by growing fund balance and liquidity levels.”
The absence of distinction between the Aa2 rating on the city’s GOULT debt and its Aa2 issuer rating is based on the city’s unlimited ad valorem tax pledge.
“We were very pleased to learn of our rating increase,” said Finance Director Lisa Crockett. “The rating upgrade is an excellent indicator of the overall financial health of the city which has continued to improve in recent years.”
The improvement in the financial health of the city is attributable to a couple of factors.
“We have seen substantial revenue increases in sales taxes and property taxes due to the growth in both commercial and residential developments,” Crockett added. “We have also made a concerted effort to reduce our overall borrowing in order to reduce our overall outstanding debt which was also a factor in the rating increase. These are exciting times for the City of Springfield.”
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