Fitch Affs Traverse Area Library District, MI's $8.5MM UTGO 'A+'.
CHICAGO--(BUSINESS WIRE)--Sept. 8, 2003
Fitch Ratings affirms the 'A+' rating on Traverse Area Library District, MI's $8.5 million of outstanding library building and site bonds. The Rating Outlook is Stable.
The 'A+' rating is based on the Traverse Area Library District's healthy growth in terms of population, wealth, and property values. The district, coterminous with Grand Traverse County, has diversified from a resort community to an area of year-round residence, leading to increased employment and wealth. Debt burden is moderate as the district has not issued any new debt since the 1996 bonds.
The library has completed its capital projects and is not likely to issue further debt in the next few years. Population increases and tax base growth (averaging 7.9% annually) has reduced debt per capita and allowed the district to maintain its low and steady tax rates. The library district has significant flexibility in both its operating and debt service millage.
The district relies on property taxes for the bulk of its revenues, representing 78% of 2002 revenues. Property tax receipts have increased steadily in recent years and total revenues have grown 5.9% annually. State revenues have remained steady from 1998 through 2002, but are expected to decline slightly in 2003 due to the state's fiscal strain. Personnel costs comprise 50.7% of total expenditures, an increase from 1998's share of 39.7%. In 2003 revenues and expenditures are expected to grow in tandem at a rate of about 5% over 2002 figures.
Despite small operating shortfalls in 2001 and 2002, the Traverse Area Library District's finances remain strong with revenue growth and constrained spending. Management expects no further draw down on fund balance in 2003 and may consider expansion in 3-5 years.