NEWS RELEASE
COUNTY OF SIMCOE
*************************
S&P Global Ratings has affirmed the County of Simcoe’s very strong AA long-term issuer credit rating for 2018.
This is the fourth year the rating agency has affirmed an AA rating along with a stable outlook for the County of Simcoe based on its healthy liquidity, minimal debt burden, and sound budgetary results. S&P Global Ratings also stated that the County’s prudent financial management continues to underpin the rating.
“As we enter a new Council term, it’s reassuring that a global auditing agency has confirmed that we’re starting from a sound financial position,” said Warden George Cornell. “The County has strong operating and budgetary oversight. Due to the prudent management of tax payers dollars, this new Council can continue to make responsible investments in our services to strengthen our municipalities and contribute to the well-being of our residents.”
The rating affirmation reflects S&P Global Ratings’ expectations that, throughout the two-year forecast horizon, the County will maintain robust liquidity, its after-capital deficit will not surpass 5 per cent of total revenues, and tax-supported debt will remain well below 30 per cent of operating revenues.
The stable outlook reflects S&P’s expectations that the County will generate healthy operating surpluses, although large capital requirements will keep after-capital results in deficit. S&P stated that they expect the County to keep managing its capital program prudently, with a strong reliance on pay-as-you-go financing, and avoid the need to issue new debt over the next two years. As a result, S&P expects the County's tax-supported debt ratio will decrease slowly to about 8 per cent of operating revenues in fiscal 2020. S&P also notes that the County has exceptional liquidity. By its calculations, the County's average free cash and liquid assets will total about $50 million in the next 12 months and represent more than 14x the estimated debt service. S&P expects this ratio to remain well above 100 per cent during the forecasted outlook.
*************************
