SOUTH HUTCHINSON – The City of South Hutchinson had its bond rating upgraded to A-3 returning it to a “low risk” rating. The designation is important because it gives the city better interest rates when financing bond projects and other financial matters.
Moody’s Investor Service says the upgrade was due to better carry over balances which leaves the city with a three to six month operating reserve.
“Current and former members of the Council deserve credit for making tough decisions and implementing fiscal measures to curb the unsustainable levels of spending that were occurring,” City Manager Joseph Turner said.
South Hutchinson entered 2012 with $832,000 in the General Fund carry over balance and had $2,000,000 in expenditures. The reserve balance represented five months of coverage and the City had a rating of A2. By the end of 2017, the reserve balance had shrunk to just $161,000 on expenses of $2,143,000. Because the city had only enough revenue on hand to cover 27 days of General Fund expenses, the bond rating had been downgraded twice.
South Hutchinson will end 2021 with about $1.5 million in the General Fund carry over balance after all planned transfers are completed.
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