04-27-2015 Council Packet - Laserfiche WebLink

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Summary: Lino Lakes, Minnesota; General Obligation Credit Profile US$3.645 mil GO bnds ser 2015A due 02/01/2031 Long Term Rating Lino Lakes City GO bnds ser 2014A due 02/01/2026 Long Term Rating Rationale AA/Stable AA/Stable New Affirmed Standard & Poor's Ratings Services assigned its 'AA' long term rating to Lino Lakes, Minn.'s 2015A general obligation (GO) bonds. At the same time, we affirmed our existing 'AA' rating on the city's existing GO debt. The outlook is stable. The bonds are general obligations of the city, which has pledged its full faith and credit power to levy direct general ad valorem property taxes without limitation as to rate or amount. In addition, the city will pledge abatement revenues.. The series 2015A bond proceeds will be used to finance various street reconstruction projects and for construction projects associated with a new municipal fire station. The 'AA' rating reflects our assessment of the city's: • Strong economy, with access to a broad and diverse metropolitan statistical area (MSA); • Strong management, with "good" financial policies; • Strong budgetary performance, with operating surpluses in the general fund and at the total governmental fund level; • Very strong budgetary flexibility, with an available fund balance in fiscal 2013 of 61% of operating expenditures; • Very strong liquidity, with total government available cash of 2.8x total governmental fund expenditures and 11.3x governmental debt service, as well as access to external liquidity we consider strong; • Weak debt and contingent liability position, with debt service carrying charges of 25.2% and net direct debt that is 181.6% of total governmental fund revenue, but rapid amortization with 92.3% of debt scheduled to be retired in 10 years; and • Strong institutional framework score. Strong economy We consider Lino Lakes' economy to be strong. Lino Lakes, with an estimated population of 20,574, is located in Anoka County in the Minneapolis, Minn., St. Paul, Minn. Bloomington, Wis. MSA, which we consider to be broad and diverse. The city has a projected per capita effective buying income of 120% of the U.S. level and per capita market value of $87,415. Overall, the city's market value grew by 1.8% over the past year to $1.8 billion in 2015. The county unemployment rate was 4.9% in 2013. Strong management We view the city's management as strong, with "good" financial policies and practices under our Financial W W W. STANDARDANDPOORS. COM/RATINGSDIRECT APRIL 24, 2015 2 1395482 300238792