Fitch Rates Albany, NY GOs `A'.Business Editors NEW YORK--(BUSINESS WIRE)--Sept. 14, 2000 Fitch assigns its `A' rating to the City of Albany This article is about the local government authority City of Albany. For the city, see Albany, Western Australia. For the capital of the State of New York, see Albany, New York. , N.Y.'s $17,555,000 serial bonds, series 2000. Dated Sept. 1, 2000, the bonds are scheduled for competitive sale on Sept. 20 and will mature serially from 2002-2025. Additionally, the city's $58.9 million outstanding general obligation bonds are rated `A'. Bond proceeds will be used to purchase land for the city's landfill, and to finance equipment purchases, public infrastructure improvements, and economic development projects. The rating reflects the city's stable economy, improving financial prospects, and moderate debt burden. Substantial public and private investment throughout the city is expected to boost the property and sales tax sales tax, levy on the sale of goods or services, generally calculated as a percentage of the selling price, and sometimes called a purchase tax. It is usually collected in the form of an extra charge by the retailer, who remits the tax to the government. bases after several years of stagnation Stagnation A period of little or no growth in the economy. Economic growth of less than 2-3% is considered stagnation. Sometimes used to describe low trading volume or inactive trading in securities. Notes: A good example of stagnation was the U.S. economy in the 1970s. . Moreover, under a new law, the state will pay $273 million to the city over 30 years to offset lost property tax revenues stemming from the presence of the Empire State Plaza The Governor Nelson A. Rockefeller Empire State Plaza (commonly known as simply the Empire State Plaza and less formally as The South Mall) is a complex of several state government buildings in downtown Albany, New York. office complex. This amount will supplement general state aid and should provide the means to restore the city to balanced operations. Uncertainty surrounding solid waste disposal is lessened by the recent approval of an expansion to the Rapp Road landfill, although the city's efforts to acquire land in the Town of Coeymans to affect a long-term solution have met with opposition. Located along the Hudson River Hudson River River, New York, U.S. Originating in the Adirondack Mountains and flowing for about 315 mi (507 km) to New York City, it was named for Henry Hudson, who explored it in 1609. Dutch settlement of the Hudson valley began in 1629. , approximately 140 miles north of New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , Albany is the state capital and home to many state agencies and departments. State government is the largest employer, drawing workers from the entire Capital District region. City and county government jobs also lend stability to the employment base, along with the presence of SUNY-Albany and a sizable health care sector. In addition to the Empire Plaza agreement, the city and state have agreed to encourage the use of private developers for new state-occupied buildings and, alternatively, for the state to provide payments-in-lieu-of-taxes for state-owned facilities. Albany's financial position will benefit almost immediately from the Empire Plaza agreement since the first installment of $4.5 million will be paid in Dec. 2000. The adopted 2000 budget called for the use of $1.2 million of general fund balance, virtually eliminating the city's remaining reserves; with the Empire Plaza payment, the city expects to end the year with an operating surplus Operating surplus is an accounting concept used in national accounts statistics (such as United Nations System of National Accounts (UNSNA) and in corporate and government accounts. It is also used in macro-economics as a proxy for total pre-tax profit income. and add modestly to fund balance. The timing of this additional state support is critical given the rapid deterioration of the city's general fund reserve position over the past three years from a high of 19% in 1996 to an estimated 1% for 1999. While audited results for 1999 are not yet available due to a late re-bidding of the audit work, the preliminary estimate is for a general fund balance of approximately $1 million. For much of the past decade, the city's budget lacked structural balance and the city annually appropriated and spent from reserves. However, substantial cost cutting efforts, including an 11% reduction in workforce, and the resolution of landfill capacity issues have largely closed the budget gap. Fitch expects that the new state in-lieu tax payments will allow for balanced operations, targeted increases in service levels, and a gradual buildup of fund balance. The restoration of general fund reserves will provide additional financial flexibility, which Fitch considers critical to future rating improvement. The city's overall debt levels are affordable at $1,811 per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals. and 5.4% of property market value. These figures include the overlapping debt Overlapping Debt The debt of a political entity such as a state where its tax base overlaps the tax base of another political entity such as a city within the state. Notes: If the issuer of a municipal bond has overlapping debt, it should be considered. of Albany County Albany County is the name of two jurisdictions in the United States in different states:
Fitch is an international rating agency that provides global capital market investors with the highest quality ratings and research. Dual headquartered in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of and London with a major office in Chicago, Fitch rates entities in 75 countries and has some 1,100 employees in more than 40 local offices worldwide. The agency, which is a combination of Fitch IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals and Duff & Phelps Credit Rating Co., provides ratings for Financial Institutions, Insurance, Corporates, Structured Finance, Sovereigns and Public Finance Markets worldwide. |
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