Clarksville, TN – A recent report by Fitch Ratings, Inc. has affirmed the City of Clarksville’s Issuer Default Rating (IDR) at ‘AA’ with a stable outlook. The ‘AA’ rating has been reaffirmed on all of the City’s outstanding bonds.
Fitch used a new formula to determine the IDR rating that has just been released for municipal entities, which recognizes that they are not similar to “for profit” companies.
According to Fitch, the City of Clarksville’s rating reflects strong financial resiliency.
Manageable carrying costs, flexible labor conditions, and a willingness to raise revenues support the City’s ability to maintain solid reserves throughout the economic cycle.
The report also notes that the City tax base has grown steadily over the past decade.
Fitch rated the City as ‘AAA’ in three of the four factor assessments including revenue framework, long-term liability burden, and operating performance. The City’s expenditure rating received a ‘AA’ rating.
The report’s operating performance assessment stated that the City’s high inherent budget flexibility, low revenue volatility, healthy reserves and the willingness to raise revenues position the city to comfortably withstand economic downturns. The report also notes that expectations for sustained strong revenue growth contributes to a superior revenue framework, and that future debt plans support a continued long-term liability.
“The ‘AA’ rating with stable outlook by Fitch reaffirms the City’s exceptional financial position in the market,” said Clarksville Mayor Kim McMillan. “The fact that the City’s audit was filed on time and with no findings for the fourth year in a row is a tribute to our finance department and all of the departments in city government.”