Henrico County has earned an Aaa bond rating from Moody’s Investors Service for its upcoming water and sewer revenue bond issue, making it one of 12 localities in the country to receive the company’s highest possible rating.
Moody’s upgraded its rating from a previous Aa1 as Henrico prepares to issue an estimated $77.2 million in water and sewer revenue bonds to support utility-system improvements.
Henrico has maintained AAA ratings for water and sewer bonds from both Standard & Poor’s and Fitch Ratings since 2009. It has held Aaa and AAA ratings from Moody’s and Standard & Poor’s for general obligation bonds since 1977. It secured a similar AAA rating from Fitch in 1998.
“The bond ratings assigned to Henrico County after three independent and comprehensive reviews reflect the highest degree of confidence in our community’s long-term stability and its fiscal health and management,” County Manager John A. Vithoulkas said. “Superior bond ratings matter, because they allow communities to borrow money at favorable interest rates to build schools, libraries, fire stations and other public facilities.
“The rating upgrade by Moody’s and the reaffirmation of top ratings by Standard & Poor’s and Fitch put us in elite company. If you also consider our low tax rates and high quality of life, Henrico County clearly represents the gold standard of communities.”
Moody’s announced its Aaa rating and stable outlook for Henrico’s water and sewer system revenue bonds to investors this week.
“The Aaa rating reflects the system’s dynamic service area and regional nature of service provision,” Moody’s said in its announcement. “The rating further reflects a healthy financial performance with a narrower liquidity position due to support of the system’s capital program, ample water supply and capacity, manageable leverage, and satisfactory legal provisions.”
Henrico plans to use some of the proceeds from the upcoming bond sale to refinance a portion of its outstanding revenue bonds, which is expected to result in savings without extending the debt’s retirement date.
Henrico’s water and sewer system is supported by revenues generated by the enterprise, not by general tax dollars. The system serves nearly 99,000 water customers and 96,000 sewer customers.