Fitch Ratings, a leading provider of credit ratings, commentary and research for global capital markets, recently reviewed the City’s financial condition with a review of annual financial reports from Fiscal Year 2018/19 through Fiscal Year 2020/21. Fitch noted the City’s continuing efforts of fiscal prudence, sustained revenues above expenditures, and the ability to reduce capital spending in the event of an economic contraction.
Fitch affirmed the City’s credit rating or Issuer Default Rating at “AA+” as well as the Vista Joint Powers Financing Authority Lease Revenue Bonds (Prop L) at “AA”, and provided a “Stable” Rating Outlook. “This is a reflection of the prudent fiscal decisions made by the City Council since the Great Recession in building the General Fund reserves up to the current City Council goal of 35% of General Fund expenditures,” said Patrick Johnson, City Manager.
Fitch reported, “The city positioned itself well to address adverse effects from the pandemic through a combination of strong reserve levels and prompt budget management. The city has a solid track record of maintaining expenditures well below revenues, leading to annual surpluses before and through the pandemic.”
Why this is important?
The affirmation reflects Fitch’s expectations that the City of Vista will maintain an adequate operating performance and manageable debt levels. The financial ratings are used by investment professionals to assess the likelihood a debt will be repaid, and can potentially allow a local government to borrow at lower interest rates, saving its taxpayers’ money over the life of the bonds.
Summary
Fitch Ratings affirmed the City of Vista’s credit rating at “AA+” as well as the City’s Prop L Bonds at “AA”, and provided a “Stable” Rating Outlook for Vista.
Fitch ratings is a credit rating agency that rates the viability of investments relative to the likelihood of default.
Fitch is one of the top three credit rating agencies internationally, along with Moody’s and Standard & Poor’s.
Fitch uses a letter system; for example, a company rated AAA is very high quality with reliable cash flows, while a company rated D has already defaulted.
Contact
Mike Sylvia, Finance Director/Treasurer
P: 760.639.6170
E: msylvia@cityofvista.com
