S&P: LeRoy, MN GO Debt Rating Raised To 'A+' From 'A' On Stronger Finances
"The upgrade reflects LeRoy's improved budgetary flexibility and liquidity," said S&P Global Ratings credit analyst Eric Harper.
The bonds are secured by the city's unlimited-tax GO pledge. The city's 2012A bonds are also secured by the net revenues of its water and sewer system and special assessments. The authority's 2013A bonds are also secured by the net revenues of LeRoy's congregate care facility. However, we rated to the city's GO pledge, which we view as the stronger security.
"The long-term rating reflects our view of the city's strong budgetary performance and very strong budgetary flexibility and liquidity," said Mr. Harper.
LeRoy, with an estimated population of 917, is in Mower County in southeastern Minnesota on the Iowa border.
"The stable outlook reflects our expectation that LeRoy will maintain its very strong budgetary flexibility and liquidity," added Mr. Harper, "and we do not expect a rating change within the two-year outlook period."
We could raise the rating if LeRoy's economy were to improve to levels commensurate with peers. Conversely, we could lower the rating if, due to structural imbalance, the city's available fund balance declined below our low nominal threshold, $500,000.