Bond, rated

The city has received another “AAA” bond rating from the three U.S. financial rating agencies, with a stable outlook given to its ability to repay debt for long-term capital improvement projects. The rating represents the eighth year in a row that Standard & Poor’s, Moody’s Investors Service and Fitch Ratings have given Austin the highest bond rating possible, a distinction that gives the city a low borrowing cost to take out bonds. As an example, a round of tax-exempt public improvement bonds with a 20-year term were sold last week at a true interest cost of 2.77 percent. Those bonds are part of a portfolio of debt products the city recently undertook and they will be used to help support affordable housing projects. The high bond rating – which is calculated based on local economic strength, the city’s financial and administrative management, and a variety of debt ratios – will come into play in determining the borrowing costs to secure the bonds for whatever portions of a seven-part series of bond projects that voters will decide in November.