Heading in a better direction than in the past, three sets of City of Tacoma bonds have seen their outlook revised by the financial information company Fitch Ratings .
Fitch has declared that the outlook for the bonds has gone from “Negative” to “Stable.”
The bonds include:
• $21.8 million in unlimited tax general obligation bonds are stable with the rating “A+.”
• $185.2 million limited tax general obligation bonds are stable at “A.”
• $28.1 million convention center and parking revenue bonds are stable at “A+.”
Fitch upgraded its negative outlook because of several factors, according to a statement issued Wednesday. The company cited a change in the financial management team at the city, a balanced budget for 2013-2014 as well as “positive general fund results for fiscal 2012 after four consecutive years of deficits.”
The company also cited “long-term challenges,” including “sluggish revenue growth and ongoing cost pressures, particularly for salary and benefit items.” Recent progress could be reversed, Fitch said, if projections showing a “substantial general fund budget gap for the 2015-16 biennium” are realized.
Reacting to the positive change in outlook, Tacoma Mayor Marilyn Strickland said in a press release, “We’re encouraged by this news. The City of Tacoma will continue to work hard to ensure that it stays on this healthier financial path.”
“We want to ensure that the recent progress we’ve made is not reversed,” stated City Manager T.C. Broadnax. “Work is already underway to address our long-term financial challenges.”