The City of Pearland received positive financial news for residents and business members in conjunction the City’s sale of Series 2015 Permanent Improvement Bonds and Certificates of Obligation. The city’s bond credit rating was confirmed by Moody’s Investor Service at Aa2, giving the city a stable outlook.
The money from the bond sale finances the construction of Fire Station 2, a 10,726 square foot station located at northeast corner of Fite and Harkey; the Sports Complex at Shadow Creek Ranch, a multiuse facility located on Shadow Creek Ranch Parkway, west of Kingsley; and the replacement of concrete paving within Regency Park Subdivision.
The sale also funds the design of Independence Park Phase I, Centennial Park Phase II and the Delores Fenwick Nature Center. Transportation initiatives funded by the sale include the Kirby Drive Expansion which will extend two lanes from the Pearland Town Center entrance to CR 59, design of Bailey Road and cooperative drainage improvements for Bailey Road that will regrade drainage ditches along several roads between Bailey and CR100 and replace/reset driveway culverts at the proper elevation.
“This bond rating affirms the City of Pearland is making sound financial decisions in an environment full of challenges and opportunities,” said Pearland Mayor Tom Reid. “In Pearland, we are managing the growth and development, adding park and road mobility improvements and keeping City facilities current as best we are able,” he continued.
The rating review, a standard practice when new debt financing is issued, reflects the City’s sound financial management practices and decisions and is an indication of the Moody’s Investor Service Reaffirms City’s Aa2 Bond Rating City leadership’s commitment in ensuring long-term financial health of the City. A bond rating, similar to a person’s credit score, represents the credit worthiness of the city’s bonds to potential investors based on economic base, financial indicators, outstanding debt and financial management policies and practices.
Moody’s rating of Aa2 reflects “the city’s sizable and growing tax base, favorable socioeconomic profile, healthy financial reserve levels, and elevated debt burdens.”
Pearland’s tax base continues to build as residential development continues at a healthy pace and a number of commercial, retail, and healthcare companies have been attracted to Pearland resulting in a $7.6 billion tax base. Moody’s notes that “wealth indicators are favorable, measured by per capita income and median family income, equal to 129 percent and 160 percent of the national average respectively.” The City’s unemployment rate of 3.2 percent remains below the state (4.1 percent) and nation (5.4 percent).
Due to the implementation of the 2007 voted approved bonds, the rating agency acknowledges and expects that the city’s debt levels will remain high given the growth- related infrastructure (roads, parks, facilities) needs of the community. The City is also managing vulnerabilities that rely on sales tax revenue, which fluctuates with economic conditions.