Standard and Poor’s improves PBC credit rating

March 01, 2018
Palm Beach County Administrator Verdenia Baker at a county commission meeting held in January 2018. (Lannis Waters / The Palm Beach Post)

The news was good enough to make Verdenia Baker do a dance.

Standard and Poor’s credit rating agency recently announced that Palm Beach County’s revenue bonds – those not backed by property taxes – now have a AAA rating, the highest offered.

Both the county’s revenue bonds and those backed by property taxes now have a AAA rating, reducing costs the county pays — with money from Joe and Jane Taxpayer — when it borrows money.

Palm Beach County is one of only 11 counties in the country to have its revenue bonds rated AAA, County Administrator Baker told commissioners at a recent meeting.

Commissioners were happy to get the news.

“A job well done,” Commissioner Paulette Burdick said. “That is significant.”

Baker was also happy when her staff told her of the rating.

“When this news was shared with me, I just did the holy dance,” Baker said. “This is a huge feather in our cap.”

Baker said the 2016 passage of an increase in the sales tax is part of the reason for the improved rating. Money from the tax increase, which is expected to generate more than $800 million for the county, is being used to improve or replace roads, bridges and county-owned buildings.

Having the additional sales tax money means the county won’t have to use other funds to pay for those public works projects, something Baker said credit rating agencies view as a plus.

The high credit rating “saves us money in the long run,” Baker said. “It looks like we’re financially sound and that we’re good stewards of the public’s money.”

The county’s strong financial position has allowed it to refinance debt in recent years.

Sherry Brown, director of the county’s Office of Financial Management and Budget, said the county saved just under $71 million from 2012 to 2017 because of refinancing. She said there are no current plans to refinance debt because of the improved S&P revenue bond rating.

Two other counties in Florida — Collier and Hillsborough — have revenue bond ratings of AAA from S&P. California has seven such counties: Contra Costa, Santa Clara, Marin, San Diego, San Luis Obispo, San Ramon and Sonoma.

Franklin County in Ohio is the other county with a revenue bond rating of AAA from S&P.