This week, two of the largest bond rating agencies in the United States released their 2019 ratings for the Municipality of Anchorage (MOA) and the outlook is positive. Fitch Ratings assigned “AA+” to the MOA for general obligation (GO) bonds and affirmed “AA” for Certificates of Participation (COPs) and “AA-“ for Anchorage Convention Center revenue refunding bonds. Fitch also maintained MOA’s outlook as stable. Standard & Poor’s ratings were also positive, issuing the same rating as 2018, AAA.
“With the recent downgrade of both the State of Alaska’s and the University of Alaska’s bond ratings, the reaffirmation of the MOA’s positive bond rating demonstrates that doing things the Anchorage way brings strong economic opportunities to investors and residents,” said Mayor Ethan Berkowitz. “Despite the tumult at the State level, our city continues to inspire confidence in professional and individual investors—that’s what it means to be open for business.”
On Tuesday, the MOA issued refunding bonds worth $44 million. The strong bond ratings and low interest rates will save taxpayers $5.1 million in future debt service over the next 10 years, the city said. The MOA also sold $37 million for voter-approved road, drainage, parks and recreation, and other capital projects in the Municipality. The Anchorage School District educational capital improvement bonds were sold for $41 million.
Every year the MOA retires bonds as it issues new ones for upcoming projects. The cost of borrowing money has gone down significantly over the years; the 2019 tax-exempt municipal rates are approximately 1.5% lower for a 20-year bond than they were ten months ago, the city said.