COUNTY OF LOS ANGELES
Contact: Judy Hammond, Director of Public Affairs, (213) 974-1363
Brian Lew, Assistant Director, (213) 974-1652
June 10, 2010
County Receives Highest Credit Ratings
The County of Los Angeles has received the highest ratings from the top three credit rating agencies for its annual short-term cash flow financing, Chief Executive Officer William T Fujioka announced today.
The ratings by Moody’s, Standard & Poor’s, and Fitch Ratings mean that the County will have to pay less to borrow money it needs to finance operations while awaiting the receipt of taxes and other revenues.
The Board of Supervisors has authorized the sale of up to $1.5 billion Tax and Revenue Anticipation Notes (TRANs) for the 2010-11 fiscal year. The notes are expected to be sold on July 1.
The County has issued TRANs annually since 1977 to assist with cash management. Treasurer and Tax Collector Mark Saladino, who recommends the amount of TRANs to be issued, said the short-term borrowing program is necessary since the County receives certain revenues, such as property taxes, on an uneven basis throughout the year.
In its announcement this week, Fitch Ratings said its highest F1+ rating reflected Los Angeles County's diverse and mature economy, sound financial reserves, prudent management efforts to achieve fiscal balance, and low debt burden.
CEO Fujioka said the confidence of the rating agencies is a tribute to the fiscal management of the Board of Supervisors.
“The County is in much better financial shape than many other cities and counties because of the fiscal leadership and long-term budgeting discipline by the Board of Supervisors,” he said.
Fujioka said the County, like other governmental agencies, is having a difficult time coping with the sustained economic slowdown, so the savings that will be realized due to the high bond rating is extremely important.