Standard & Poor’s Ratings Services today increased its credit outlook for the City of Windsor from AA-Stable to AA-Positive. This positive outlook reflects Standard & Poor’s expectation that the City of Windsor’s debt is on a downward trend and that budgets are being properly monitored.

“A good, stable credit rating has just become a very positive credit rating,” said Mayor Eddie Francis. “The rating reflects the fiscal responsibility and strong action of City Council over the past three years to control spending, give taxpayers value for their investment, diversify our local economy, and to support jobs and a great quality of life for Windsor residents. This announcement makes Windsor an even more attractive prospect for future investors.”

Today’s announcement by Standard & Poor’s Ratings Services confirms that the revision is largely based on the City of Windsor’s effective financial policies and procedures:

• The city’s implementation of its debt reduction policy in recent years and the continuation of the 1% capital levy have placed the city’s direct debt burden, which stood at 28% of operating revenues as at the end of 2005, on a sustainable downward trend that should continue in the medium term. Standard & Poor’s expects Windsor’s direct debt burden to decline to 22% of revenues by the end of 2009, which would be below the middle of the range for similarly rated peers;
• The material improvement in the city’s annual budgetary performances in each of the past three years, as reflected in annual operating surpluses of about 16% of operating revenues. This is a significant improvement from below 9% of operating revenues only five years ago;
• Strong, albeit moderating, assessment growth in the three years ended Dec. 31, 2005; and
• Improving financial flexibility as a result of the city’s implementation of the aforementioned capital levy and receipt of federal and provincial gas tax revenues, which the city has earmarked for transit and road improvements.

The report also cited the City of Windsor’s pro-active approach to diversifying the local economy. Strong credit ratings are important to a municipality in order to reduce borrowing costs and attract investors to the community.

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