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Santa Clarita credit rating upgraded to AA+

Posted: June 11, 2009 2:23 p.m.
Updated: June 12, 2009 2:20 p.m.
 
The city of Santa Clarita's Standard & Poor's credit rating was upgraded this week from AA to AA+, characterizing the city as having "very strong wealth and income levels."

This is the city's third credit upgrade in five years.

Standard & Poors said: "The city (of Santa Clarita) has in our view, performed well financially in recent years and in our opinion, has a very strong 44.6% of expenditures, up from $28.5 million in 2007. For fiscal year 2009, sales taxes, which account for approximately 37% of revenues, have fallen 15% to about $27.8 million. Management reports that it cut expenditures to adjust for declining revenues, and operating revenues have exceeded expenditures by about $300,000 so far."

tandard & Poors' Ratings Services has raised the ratings on the debt of only 16 municipalities in California, Colorado and Washington, following a review of their credit strengths. According to Standard and Poors, the key to achieving higher ratings is demonstrating stability, both economic and financial.

"The city of Santa Clarita continues to be a choice destination for new business, with two shopping center openings and a mall expansion occurring over the last 18 months, not to mention an increase in location filming," said Pulskamp, city Manager. "Our strong local economy, excellent fiscal management, diversification of business and our great community have helped Santa Clarita weather the national recession better than most."

The Standard & Poors report continued: "s with our recent reviews of cities and counties in other regions, we believe that these communities have demonstrated some combination of the following credit strengths: economic stability, strong financial performance and good management practices. In our opinion, reading beyond the numbers is critical to an appropriate rating and this applies to economic data, financial metrics, and administrative and debt factors."

The city of Santa Clarita has a 100% track record for adopting a balanced, on-time budget, with ample reserves and contingency funds.

The city's philosophy of conservative budgeting, excellent fiscal planning and belief that: "The decisions you make in bad times are more important than the decisions you make in good times," have helped Santa Clarita improve its credit rating, maintain a strong reserve and enjoy excellent fiscal health.

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