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Queen Creek’s bond rating affirmed as the town prepares to fund transportation improvements

Queen Creek’s bond rating affirmed as the town prepares to fund transportation improvements

[NEWS RELEASE] Standard & Poor’s and Fitch Ratings, leading providers of credit ratings, both affirmed the town of Queen Creek’s AA rating and stable outlook after completing independent reviews.

The bond rating affirmations are significant as the town prepares to issue an excise tax bond to fund critical infrastructure improvements.

During the Dec. 6 town council meeting, Resolution No. 1174-17 was approved unanimously. The resolution authorized Town staff to issue an excise tax bond of $75 million; the bond will not result in any new taxes. (View a video explanation by Queen Creek Chief Financial Officer Scott McCarty.).

“Having the town’s credit rating and outlook affirmed by both agencies is key in securing lower interest rates,” stated Queen Creek Chief Financial Officer Scott McCarty. “From a financial standpoint, the town is in an excellent position to fund necessary improvements without issuing any new taxes for residents or businesses. Thanks to the foresight of our town council, the town has funds allocated to repay the debt in our budget.”

Assuming market conditions remain favorable, the excise tax bond is anticipated to be issued in February. It will include $65 million for transportation projects and $10 million for the recently completed Law Enforcement Building, Fire Station No. 1 and Fire Station No. 3.

“Issuing a bond allows us to build our much-needed infrastructure now, making payments over time,” stated Queen Creek Mayor Gail Barney. “As a council, it is important we make financially sound decisions, and that we ensure improvements are funded fairly. The bond allows us to pay with both our operating budget and impact fees – meaning both current and future residents are paying their fair share.”

The $65 million designated for transportation will help fund roadway improvements identified in the town’s 10-year capital improvement plan.  The plan includes 36 projects, adding 84 new lane miles, and will cost approximately $195 million.

To learn more about the CIP, including roadways under construction and in the design phase, visit QueenCreek.org/BetterRoadsAhead.

The town has received a series of credit rating increases over the years, with both S&P and Fitch Ratings upgrading the Town’s rating to AA in 2016.

Rating agencies look at four main categories: debt burden, management, financial performance, and economic base.

The town’s strong revenue framework, reduction in long-term liabilities, expenditure flexibility and demographics related to income and education were cited as factors contributing to the rating affirmation.

To view the reports, select Standard & Poors and Fitch Ratings.

For more information about the town, including its budget, visit QueenCreek.org.

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