The three major credit-rating agencies – Fitch Group, Moody’s Investors Service and Standard & Poor’s (S&P) Global Ratings – have affirmed Hanover County’s Triple-AAA bond rating in advance of a $42.7 million general obligation bond issuance on August 16th. The bonds will be issued through the Virginia Public School Authority (VPSA) and will be used to finance construction of the replacement John M. Gandy Elementary School and various school facility improvements included in the adopted FY2023 Capital Improvements Plan.
All three ratings agencies cited Hanover’s prosperous and diverse tax base, strategic economic development, and strong and conservative financial management as supporting the affirmed Triple-AAA rating, which the County achieved in 2010.
As of August 2022, 14 states, 49 counties and 31 cities have a AAA bond rating from all three major rating agencies, which is the equivalent to a perfect credit rating for a citizen. This distinction means that Hanover County can borrow money at the lowest rate the market allows, creating considerable savings in interest costs, which in this particular issuance allows the County to maximize the number of projects which improve student learning environments without creating additional tax burden on our residents.
“We have long been proud of our County’s AAA ratings,” said County Administrator John A. Budesky. “We take pride in being careful stewards of the funds provided by our taxpayers and stakeholders. This bond issuance is a great example of how your government’s financial management has led to greater savings on needed capital expenditures.”
“The AAA rating reflects the county’s favorably located, sizable and diverse tax base, as well as its sound prospects for continued economic development, which will drive further tax base expansion,” noted Moody’s Investors Service.
“The rating reflects our opinion of Hanover County’s very strong property tax base that continues to grow…supporting continued positive budgetary performance that has led to year-over-year increases in available reserves,” noted S&P Global Ratings. “The county has a favorable debt profile…with medium-term debt plans that we believe will remain sustainable for the county.” The agency also cited Hanover’s “disciplined and prudent financial management policies”.
“The affirmation of the County’s Triple-AAA rating is a testament to the County’s commitment to sound fiscal stewardship and the continuation of following best financial management practices. These ratings continue to show Hanover’s focus on being prudent stewards of taxpayer funds,” said Jay Brown, Deputy County Administrator.
“These ratings are supported by notable financial flexibility, which stems from the county’s large reserve balance in relation to expected cyclical revenue volatility and solid expenditure flexibility,” noted Fitch Ratings. Fitch expects that these factors, coupled with a low long-term liability burden and conservative financial management, would enable the county to maintain financial stability and solid reserves through a future economic downturn.”
“Deliberate planning and strategic use of funds has allowed for all three major credit-rating agencies to once again affirm that Hanover’s approach to investing in our community while maintaining our tax rate and conservative approach to financial management is one that will allow us to respond to the needs of our citizenry for years to come,” said Amanda Six, Director of Finance and Management Services.
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