PURCELLVILLE, Va. September 12, 2017— The Town of Purcellville is pleased to announce that the national credit rating agencies have affirmed the Town’s very strong creditworthiness on its general obligation debt, with some of the highest credit ratings possible. During a recent presentation to the three rating agencies, Mayor Kwasi Fraser and Town Management described the Town’s healthy and vibrant economy, strong financial status, and careful long-term debt reduction planning. These ratings will allow the Town to restructure portions of its current debt at very low interest rates in order to remove limitations on monetizing key assets and to balance future payment requirements.
The rating agencies specifically cited the Town’s business and revenue growth, which demonstrates a strong economy and continued demand for services. The diversity among various revenue options is a key part of ensuring the Town’s long-term financial strength. Additionally, the Town was pleased to discuss its strong annual financial performance and how the existing Unassigned Fund Balance can be used strategically to help pay down debt while maintaining reserves in accordance with fiscal policies.
The Town was reaffirmed as a AAA rated community by S&P Global Ratings (S&P), the highest credit rating possible. In their review, S&P cited a number of key factors, including a “very strong economy;” “very strong management;” and “very strong budgetary flexibility,” amongst other factors.
In addition, the Town was reaffirmed at Aa2 by Moody’s Investors Services (Moody’s), which is only one rating category below AAA status. In their report, Moody’s stated that their Aa2 rating of the Town “reflects the town's modestly sized but growing tax base with very strong wealth indicators, a healthy financial position evidenced by strong reserve levels, and an above average but manageable debt profile with a high degree of self-supporting debt obligations.”
Fitch Ratings (Fitch) also reaffirmed AA rating of the Town, with a Positive rating outlook. Fitch gave the Town a consideration of “aaa” in two key areas and a consideration of “aa” in the remaining two areas. Their comments specifically cited “the town’s impressive income metrics” and a “high level of fundamental financial flexibility” in their report.
Mayor Fraser was pleased with the results of the ratings, saying, “I commend the Town Council for taking clear and discernible strategic steps to provide structural balance in the Town’s General Fund and Enterprise Fund. The plan we initiated honors our commitment to the citizens, and will continue to be refined, while serving as a solid foundation for the Town’s finances for years to come. Through this effort, we have been able to keep our utility rates flat for the coming year through lowering operational costs and increasing efficiencies, paying down some of the Town’s debt, and bringing in new revenue from some of our underperforming assets. Our Town’s financial consultants, and now the three national credit rating agencies, have evaluated our approaches and economic outlook and agree that Purcellville is financially strong, and our future is very bright.” The Mayor also added “we thank our Interim Town Manager, Alex Vanegas, and his team for their managerial excellence throughout this process.”
Interim Town Manager Alex Vanegas commented on the most recent budget process, saying, “The many months of budget work sessions and utility discussions led to this very favorable result for the Town. I express my thanks to the staff – especially in the Finance Department – for their tireless efforts managing the Town’s finances and taking a proactive, conservative approach to the Town’s fiscal health. Their efforts combined with Council’s policy decisions have left the Town in a very strong position and prepared financially for many years to come.”