Port Angeles bond rating rises to Aa3

PORT ANGELES — Sound financial policies and council-identified priorities have improved the city of Port Angeles’ bond rating, City Manager Dan McKeen announced last week.

Moody’s Investors Service has raised the city’s bond rating from a “decent” A2 and A3 to a “substantially higher” Aa3, McKeen told the City Council on July 17.

The improved investment-grade rating means the city would pay less for future bonds and could save substantial sums of money by reissuing existing debt.

“That could save our citizens not hundreds of thousands, but sometimes even millions of dollars, depending upon the bond,” McKeen said.

Acting Finance Director Tess Agesson said the first opportunity for the city to reissue existing debt would be in six to seven years when the limited tax general obligation bond that paid for the landfill bluff stabilization project at the Port Angeles Regional Transfer Station reaches its 10th year.

Meanwhile, city officials have no plans to take on new debt.

“That was another reason why we had such a great rating,” Agesson said, “because we haven’t gone out for governmental bonds in the last few years.”

“We’ve been maintaining and paying as we go, and they really like that,” Agesson added.

The city’s last bond rating was set in 2006.

In the recent evaluation for a new bond rating, Moody’s officials recognized that Port Angeles has a relatively low average family income, McKeen said.

“Our citizens’ ability to pay is not the same as many other communities, and that affects the rating also,” McKeen said.

“But the reason we got such a high rating was because of all the other hard work we did, and because of our financial health. We have financial challenges, but we also have reasonable, in fact, good financial health in the way that we approach our finances.”

When McKeen became city manager in 2012, it was discovered mid-year that the city was projected to lose about $800,000 by year’s end.

After making some “difficult budget decisions” to stem the tide, the council mounted a two-pronged strategy for long-term financial health by developing financial policies and going through a priority-setting process, McKeen said.

“We did use that priority-setting process in shedding some of our sustainable expenses and we were able to maintain a balanced budget,” McKeen said.

Among the new financial policies was a council directive of having a 25 percent reserve fund balance as compared to general fund spending.

“I’m happy to say that we’re over the 25-percent general fund reserve requirement that we implemented from a 10 percent years ago,” McKeen said.

The current City Council, which includes four freshmen members, has embarked on a new priority-setting process.

________

Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 56450, or at rollikainen@peninsuladailynews.com.

More in News

Wind returns for Day 3 of Race to Alaska

Teams pushing north along Vancouver Island

Port Townsend pool on track to open in July

Task force favors Chimacum Park for replacement

‘Positive support’ shown for Recompete grant

Port of PA extends lease with Homeland Security

Jason Minnoch, left, and Jim deBord move a set of musical chimes as Al Oman and Jo Johnston look on during preparations on Wednesday for Sunday’s playground opening of the Dream Playground at Erickson Playfield in Port Angeles. The playground, rebuilt by volunteers in May after much of it was destroyed by arson in December, will host an official reopening and dedication ceremony at 3 p.m. Sunday. (Keith Thorpe/Peninsula Daily News)
Reopening ceremony Sunday

Jason Minnoch, left, and Jim deBord move a set of musical chimes… Continue reading

Port Townsend, YMCA sued over 2022 pool ban

Confrontation with transgender employee at center of lawsuit

More muscle than wind in Phase 2 of Race to Alaska

Winds die down, force sailors to alternate with human power

Chris Fidler.
Port Angeles man honored with Distinguished Alumni award

Chris Fidler of Port Angeles has received the Distinguished Alumni… Continue reading

Members of the Makah Tribe bring a gray whale to shore on May 18, 1999. A federal ruling Thursday will allow the tribe to take 25 whales in a 10-year period. (Peninsula Daily News file)
Makah Tribe granted waiver to hunt gray whales

Ruling to allow tribe 25 in 10-year period

Team Roscoe Pickle Train of Port Townsend, which includes Chris Iruz, Enzo Dougherty, Odin Smith and Pearl Smith, were first out of the Victoria Inner Harbour at the start of the Race to Alaska on Tuesday. The cannon fired at noon and 38 racers headed to Ketchikan, a 750-mile contest that started in Port Townsend on Sunday. (Steve Mullensky/for Peninsula Daily News)
Racers restart in Victoria on their way to Alaska

One rescued by Coast Guard; two others try wheeling over land

Sequim city council members approved a $2.45 million purchase of 16.52 acres off West Hendrickson Road to be used for a future park. It remains closed to the public as it’s being leased for agricultural use until plans and funding can be put in place for the future park. (Matthew Nash/Olympic Peninsula News Group)
Sequim purchases 16 acres for park

City negotiated with McCord family for 2 years

Clallam sheriff pursuing $9.6M grant for public safety facility

Defense program geared to supporting military installations