Posted: 6/16/04

Hugo bond rating improves

The city of Hugo has earned a two-level increase in its credit rating from A3 to A1 affecting $9 million of outstanding general obligation debt. A higher credit rating will result in better interest rates for bonded debt. The upgrade was assigned by Moodyís Investors Service, who noted the rating ìreflects the cityís rapidly growing tax base as a suburb in the metropolitan area; a satisfactory financial operations evidenced by growing and healthy reserves; and moderate debt burden.î The city also received an upgrade rating to A2 from Baa1 on its lease revenue bonds, affecting $2.7 million. Paul T. Steinman, vice president of Springsted, Inc., St. Paul, the cityís financial advisor, said ìthis upgrade represents the hard work of staff and the city council in crafting and actively pursuing a strong financial management policy.î Steinman said the cityís ability to increase its unreserved fund balance from 35 percent in 2002 to 46 percent in 2003 ìshows amazing dexterity in council management of financial resources.î

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