2009-09-23 CC Add.'l Handouts - Laserfiche WebLink

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Summary: Centerville, Minnesota; General Obligation Credit Profile US$2475 mil GO imp crossover rtdg bnds ser 20096 dtd 10/01/2009 due 02/01/2016 Long Term Rating AA/Stable Centerville GO Long Term Rating New AA/Stable Affirmed Rationale Standard & Poor's Ratings Services assigned its 'AA' rating to Centerville, Mino,'s series 2009A general obligation (GO) improvement bonds. The rating is based on the following rating factors: . Access to employment throughout the large and diverse Minneapolis-St. Paul area, . Economic indicators that are all better than national averages, . Financial performance we consider to be very strong, and . Financial management practices we consider to be good. The city's unlimited tax GO pledge secures the series 2009B bonds, and proceeds will be used to crossover refund certain maturities of the city's series 2006A bonds. Centerville is located about 15 miles north of St. Paul in Anoka County, Minn. The city is primarily residential in nature (83% of marker value is residential) with housing values that average $300,000.$400,000. With a population of 3,800, the city's residents have easy access to employment throughout the Minneapolis-St. Paul area. All of the city's available economic indicators are favorable. Median household effective buying income (EBI) is considered very strong at 144% of the national average, while per capita EBI is considered good at 110% of the national average. In addition, estimated market value of $383 million translates to $99,833 per capita, a value we consider to be very strong. Although draw downs in the general fund balance totaling $400,000 have occurred over the previous two audited years for construction of a public works facility, financial performance remains very strong, in our opinion. As of Dee. 31, 2008, the unreserved general fund balance was $1.2 million, or a very strong 44.0% of expenditures. The city is expecting to achieve balanced operations for 2009 after adjusting its budget to account for about a $120,000 reductions in revenues due to state aid and building permit revenues. We consider the city's financial management practices to be good under Standard & Poor's Financial Management Assessment (FMA) methodology. An FMA of good indicates that financial management practices exist in most areas, although all may nor be formalized or regularly monitored. Highlights of these practices include regular reporting of budget and investment performance to elected officials, a formal five-year capital improvement plan that is updated annually, and an informal policy to maintain a general fund balance that represents at least 45% of expenditures. Although no formal debt managemenr or financial planning policies exist, the above strengths offset Standard & Poor's RetingsDirect I September 18, 2009 2 Standard & Poor's. All rights reserved, No reprint ordisserninalion without S&P's permission. See Terms of Use/Disclaimer on the last pags ;{;!ai~: 130\Ju6;;1'!J:j