By: Diane Benjamin
Go to Moodys.com to see this information. You will have to sign in with Facebook or create an account.
Remember I’ve mentioned Normal has a high credit rating because they aren’t afraid to tax? Moody’s confirms that:
It is still a really good credit rating, but it isn’t AAA. I wonder where the expanding tax base is? Thanks to Kathleen Lorenz’s flip-flop of property taxes, Normal’s credit rating won’t be downgraded based on “flexibility”. It could be downgraded because of debt and pensions.
Fitch does show Normal with a AAA credit rating – because of their unlimited ability to tax! https://www.fitchratings.com/site/search?content=research&request=Normal%20Il
What is Bloomington’s Credit Rating?
Moodys states Bloomington has an above average credit rating. It doesn’t have any recent comments other than the above.
Fitch has Bloomington at AA+ without mentioning taxes:
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Wait a couple years and it will be much worse.
Guess who they are going to blame? Does anybody want a AAA government if it means they can take all your money?
I think the reversal on the property taxes may have more to deal with the way the credit rating is calculated than hiring a pr position. I would bet the town needs to show an increase in property tax collected to show growth and keep a AAA rating.
I hope one of your readers know enough about this to verify the lowering of property taxes negatively impacts the credit rating.
I have my own credit rating system and I trust it a lot more than these jokers. If it says “State of Illinois” or is a municipality or branch of the same and it ends “, Illinois” no money is invested. The rating for Normal more than reflects this. A little homework would reveal what you mention. Expanding tax base? A look at future money wasting proposed should be taken into account….underpass, uptown 2.0, sports center. A look at the lack of success with uptown 1.0, apartments and businesses that DID not locate on floor 1, a city bailout of part of the building. Finally a look at TIF that exists should be counted as a negative when determining a ratings. .
Diane – thank you for bringing this info to light.
Per the creditor’s report, State Farm’s reduction in staffing and no increase in property tax revenue would put “downward pressure on the rating.” So the property tax increase had little to do with helping taxpayers or a new PR position, it was to maintain a credit rating. This to me means Koos is planning to put more debt on our children’s future.
Below is the excerpt from the Finch Report I based this assumption upon.
“The town takes an active role in economic development and much of the projected growth is located within tax increment districts. The town’s development of Uptown Station, highlighted by a new multi-modal transportation center, has spurred business growth as well. State Farm’s full-time work force has remained relatively steady, with no future changes expected. Mitsubishi closed its Normal plant in May, but the employment loss should be largely replaced by a new manufacturer that has acquired that space and is currently increasing employment. The town expects that much of the lost Mitsubishi plant employment should be replaced by 2024.
The town began to experience weakness in several of its revenue streams in fiscal 2018. AV grew by 3.1% last year, but the town expects only about 0.5% growth this year. The town is projecting only 1% growth in fiscal 2019 and only 1.5% annually after that, less than the 2% annual growth over the past ten years. Sales tax growth has also been slow as the town only expects 1% growth in the next couple of years. Utility tax revenue is projected to decline this year due to fewer cable and cellular phone customers and the town’s share of the state income tax is also projected to slow due to slower growth in the town’s population. Fitch expects growth in revenue through an economic cycle to be below U.S. economic performance but above the level of inflation as the town’s economic development projects, including fully replacing the lost Mitsubishi plant employment, begin to support higher growth rates in the underlying property, sales, and income tax base. Revenue growth below those expectations will put negative pressure on the rating.”
NO governmental unit in Illinois should have better than a marginal credit rating. The pension crisis, massive corruption, out of control spending, outflow of “Makers”, inflow of “Takers”, anti business attitude, proto-Marxist ideology, make the financial future very, VERY dark. Ditto CA, NY, CN.
Wonder what these States have in common? Certainly not weather. Look for a bailout in a Bernie administration……and then hopefully Civil War. Texans won’t stand for it!