City Receives Excellent Credit Rating

Tuesday, August 20, 2013 - 6:00 AM

The City of St. John’s has received a credit rating of “A+ stable” from international credit rating agency Standard and Poor’s.

“Following on the heels of the Aa2 Stable rating the City received from Moody’s in the spring, this clearly indicates that our focus on strong fiscal management processes are paying off for the City,” says Ward 1 Councillor Danny Breen, Chair of the Finance and Administration Standing Committee. “These credit ratings ensure we are able to acquire credit at good interest rates which allows us to complete important projects throughout the City.”

The report stated that “St. John's maintains strong management expertise, good financial planning, and conservative debt management policies, in our view. For 2013, it produced a three-year line-by-line revenue and expenditure forecast that coincided with the start of its three-year property tax assessment cycle. We consider this forecast strong compared with the practices of its domestic peers.”

“Last year was the first time the City has completed a three-year budget,” says Councillor Breen. “We are extremely pleased that Standard and Poor’s has acknowledged this process and endorsed our forecast in this manner. We strongly believe that by moving to a three-year budgeting process we will be able to better meet the long-term needs of the City.”

Economy

The report from Standard and Poor’s pointed to St. John’s “heated economic conditions” with offshore oil projects providing strong economic growth and construction activity in the City reaching its second highest level ever with more than $430 million in building permits issued in 2012.

While acknowledging that offshore oil projects form a major source of economic concentration, the report also noted that “St. John's has a number of supporting industries that in our view collectively provide some counterbalance to the offshore oil sector.” Supporting industries include:

  • Public sector
  • Shipping industry
  • Ocean technology
  • Tourism
  • Arts and culture

“We understand that offshore oil production is a major contributor to this region’s economic prosperity,” says Councillor Breen. “However it is important that we continue to work towards diversifying our economy to ensure the long-term economic stability of our City.”

The Conference Board of Canada’s Metropolitan Outlook-Summer 2013 also pointed to increased offshore oil production as the key factor which is making St. John’s the fastest growing economy amongst 15 Canadian cities studied in 2013.

“There are so many positive things happening in St. John’s right now,” says Councillor Breen. “We have the fastest growing economy in Canada and the City is in a very strong financial position thanks to our prudent management of our fiscal resources.”

For further information:
Jennifer Mills
Communications Officer
City of St. John's
Phone: (709) 570-2037
Cell: (709) 690-7586
E-mail: jmills@stjohns.ca

Danny Breen
Chair, Finance and Administration Standing Committee
Ward 1 Councillor
City of St. John’s
Phone: (709) 576-2332
E-mail: dbreen@stjohns.ca