County awarded highest credit ratings despite impacts of COVID-19

VENTURA, CA – The nation’s two top credit ratings firms – Moody’s and Standard & Poor’s – have awarded the County with their highest short-term rating and reaffirmed its triple A long-term credit rating – the highest possible rating. These ratings will enable the County to refinance and borrow funds at lower interest rates to fund critical needs, saving substantial taxpayer resources over time.

The high credit rating allowed for the County to refinance the Ventura County Medical Center Hospital Replacement Wing Bond on June 3 at a lower rate. This will save approximately $2 million annually in debt service payments resulting in $34 million net present value savings.

“I really appreciate this recognition of our longstanding commitment to responsible fiscal practices especially during this time of emergency. The ratings are a validation of the work the Board of Supervisors, the managers and workforce are doing to keep the county fiscally strong,” said Mike Powers, County Executive Officer. “The careful management of public funds has enabled us to weather the COVID-19 response effort, so we are positioned to continue providing much needed services and resources to our community during an extreme time of need. The community’s commitment to following the guidance of Public Health also enabled us to receive
accelerated approval for reopening our economy. These steps have been crucial as we continue to reopen and recover. These steps have also enabled us to receive strong ratings even during a time of emergency.”

“These positive ratings are also a reflection of the commitment of our local taxpaying individuals and businesses who have continued to make payments, even in the face of this unprecedented health and economic crisis, to fund core, critical health, safety and social services at a time when our community needs them the most,” Powers said.

The rating agencies provide independent assessments of the creditworthiness of the county as a borrower, which investors use as a guide to evaluate credit risk. Government credit ratings are similar to consumer FICO or credit scores. The county’s status as a low credit risk means the interest rate it pays to borrow money is lower than it would be otherwise, thus providing flexibility and security in funding vital services for the County’s constituents. When the county can borrow at a lower interest rate, all county residents’ benefit.

“Our credit ratings are a reflection of the strong fiscal guidance provided by our Board and the dedication of our finance and budget staff throughout the organization,” said Kaye Mand, County Chief Financial Officer. “They also recognized our fiscal policy requiring balanced budgets and prohibiting the funding of ongoing expenses with onetime sources.”

The ratings also reflected the view that the County has very strong budgetary flexibility, very strong liquidity, strong management with good financial policies and practices, a very strong debt and contingent liability profile and a strong institutional framework score.

The Moody’s report noted the County’s financial position remains strong and stable, supported by conservative budgeting and expenditure practices and adopted policies. The County has consistently maintained operating surpluses for many years. The report also noted that the County benefits from a strong, proactive management team with board endorsed policies regarding debt, investments and cybersecurity. The report also noted that the County’s diverse economy is less exposed to a coronavirus related slowdown.

Standard & Poor’s report also noted that the departmentwide contingency budget cuts in development, very strong reserves, and the CARES Act grant, provided expectations that the county will be able to make the appropriate budget adjustments to weather the impacts of COVID-19.

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