Christmas came a little early for Hattiesburg this year, as Mayor Toby Barker learned early Thursday morning that the city’s bond rating has been restored to an initial Aa3 by credit rating firm Moody’s Investor’s Services.
The bond rating, which was suspended late last year because of the late completion of the city’s Fiscal Year 2015 audit, was based on four strengths: growing tax base with a significant institutional presence; stable financial position; new leadership team; and a lagoon system in compliance with stipulated order. With the rating restored back to its previous status, Hattiesburg is ranked in the top five cities in Mississippi in terms of bond rating, and will be able to borrow funds at a competitive rate, as well as apply for grants for projects in the city including the upcoming Public Safety Complex and a new fire station on U.S. 49.
“I’ll use this analogy that came from our city attorney: If you were buying a car or a house and you wanted to seek financing through a loan to do that, a part of that process is the bank checking your credit score,” Barker said at a Thursday news conference at City Hall. “And for the past two years, it’s not that Hattiesburg had bad credit; it’s just that we had no credit score.
“So this means in a few weeks, when we begin to make plans to finalize these very big public safety projects that we’ve been looking to do for several years, that we can go into the market with a good credit score, and hopefully get a much better interest rate.”
The restoration of the bond rating was enabled by the completion of the Fiscal Year 2017 audit, which was approved by Hattiesburg City Council members in late November. Barker said prior to that, the city had not had an audit since Fiscal Year 2014, which led to the suspension of the bond rating and the city missing out on several million dollars worth of grants.
After the Fiscal Year 2017 audit was completed, Barker – along with City Attorney Randy Pope, Chief Administrative Officer Ann Jones and Customer Service Coordinator Joe Paul – traveled to New York to meet with representatives from Moody’s. Barker said although the bond rating restoration is good news, Moody’s officials said there are still improvements to be made in budgeting practices and building cash reserves, as well as job growth and income levels.
“And as we do that, we hope to see this rating upgraded again as well,” he said. “But today is the culmination of a lot of work from a lot of people, and this is a victory for the entire city of Hattiesburg, our employees and our citizens.”
Since Barker’s administration took office 17 months ago, the city has completed three financial audits to bring the city’s standing into compliance: Fiscal Years 2015, 2016 and 2017. During the press conference, Barker gave credit to all the people who helped make that possible, including all five city council members, Jones, Paul and Chief Financial Officer Connie Everett, along with the city’s auditing firm and underwriter.
“This comes after 17 months of hard work and commitment from a lot of people,” Barker said. “You don’t finish three years worth of audits without everyone pulling together.
