A top credit rating agency has bumped up Los Angeles’ general bonds outlook from a ranking of “stable” to “positive,” which should allow the city to borrow money at lower cost, Mayor Eric Garcetti announced Wednesday.
Standard & Poor’s also reaffirmed the city’s “AA-” long-term rating and underlying rating, as well as its ‘A+” rating for appropriation-backed debt.
The city’s Municipal Improvement Corporation of Los Angeles series 2014-A and 2014-B lease revenue bonds received an “A+” rating.
The agency’s revision of the city’s bonds outlook is recognition of the city’s “prudent budgeting,” which included “increasing our reserves to the highest level in the city’s history,” Garcetti said.
The city’s reserves are now equivalent to 8.8 percent of expenditures, according to the mayor’s office.
“Our commitment to fiscal discipline and reform is about saving taxpayer dollars to expand services for our residents,” Garcetti said.
Standard & Poor’s credit analyst Jen Hansen said the agency changed Los Angeles’ outlook rating to reflect its improved economic conditions, “including unemployment, which is below 10 percent and continues to fall, and
the city’s improving financial position, as demonstrated by a large surplus in fiscal 2013.”
