Mendota Heights’ bond rating upgraded to AAA

A stable local economy, relatively low debt load and reliable budgetary track record have added up to Mendota Heights receiving the highest possible endorsement from its rating agency.

City officials say the AAA bond rating received from Standard & Poor’s is especially noteworthy for a city as small as Mendota Heights and will help save taxpayers money in the long term in the form of reduced interest rates for city projects.

The upgraded rating came as part of a $1.7 million general obligation bond issuance by the city, which was finalized in the city council’s Oct. 1 meeting. The city received a 2.8 percent interest rating on the bonds over a 19-year period, beating the 3.1 percent rate it was projected to receive.

Nick Anhut, a representative from the city’s financial consultant Ehlers & Associates, presented the results of the bond issuance at the city council meeting and congratulated the council and staff on the new rating.

“It places the city among the top 4 percent of all municipalities that they rate, which is more than 4,000 across the United States, so it’s a very exclusive club,” Anhut said. “With that, you will cash in on the very lowest interest rate that the market allows.”

Council member Ultan Duggan also chimed in on the congratulations, pointing out residents also played a big role in the financial success of Mendota Heights.

“It’s a small city in many ways, but obviously all of the councils, staffs and engineers and public works departments and police departments and citizens in particular have done an absolutely outstanding job in creating such a best-possible rate bond rating,” Duggan said.

S & P attached a stable outlook to the Mendota Heights rating, noting the city’s strong fund balances and broad tax base. This makes it unlikely the agency will revise its rating within the next two years.

— Luke Reiter
 

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