Fitch Rates Indianapolis-Marion County Public Library, Indiana's $60MM GOs 'AAA'.CHICAGO -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has assigned an 'AAA' rating to the Indianapolis-Marion County Public Library The Indianapolis-Marion County Public Library (IMCPL) is the public library system that serves the citizens of Marion County, Indiana and its largest city, Indianapolis. The Library was founded in 1873 and has grown to include a Central Library building, located in the heart of , Indiana's (the library) following issues: --Approximately $40,025,000 general obligation (GO) refunding bonds refunding bond A bond that is issued for the purpose of retiring an outstanding bond. Issuers refund bond issues to reduce financing costs, eliminate covenants, and alter maturities. See also crossover refunding bonds, prerefunding. , series 2007; and --$20,000,000 GO bonds, series 2007. The $40 million GO refunding bonds are scheduled for negotiated sale through JP Morgan Securities, Inc. on or about March 27, 2007, while the $20 million GO bonds will sell competitively on or about April 18, 2007. H.J. Umbaugh and Associates is serving as the library's financial adviser on both transactions. Proceeds will finance a portion of the library's central library expansion project and refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. outstanding GO debt. The bonds are general obligations, payable from ad valorem taxes Ad Valorem Tax A tax based on the assessed value of real estate or personal property. In other words ad valorem taxes can be property tax or even duty on imported items. Property ad valorem taxes are the major source of revenues for state and municipal governments. levied on all taxable property within the library district. Fitch also affirms the 'AAA' rating on the library's $109.6 million of outstanding general obligation debt. The Rating Outlook is Stable. The 'AAA' rating reflects the library's strong and diverse economic base, consistent financial performance, and extremely low direct debt levels. The library has minimal operating risks Operating risk The inherent or fundamental risk of a firm, without regard to financial risk. The risk that is created by operating leverage. Also called business risk. , with past changes in financial position related to the internal funding of capital expenses. Financial reserves are good in the context of these risks and are enhanced by the financial support of a separately managed private foundation, which complements the library's community service. The library anticipates that without growth, property tax limitations would result in modest revenue declines in the next three years due to the implementation of the circuit breaker circuit breaker, electric device that, like a fuse, interrupts an electric current in a circuit when the current becomes too high. The advantage of a circuit breaker is that it can be reset after it has been tripped; a fuse must be replaced after it has been used tax credit, but cost reductions achieved in the past year have better prepared the library to absorb these potential losses. Although construction of the central library experienced delays in 2004, which increased final costs, construction resumed in July 2005. Proceeds from this issue should provide the additional funds necessary to complete the central library, currently scheduled to open to the public in late 2007. The library serves all of Marion County Marion County is the name of seventeen counties in the United States of America, mostly named for General Francis Marion:
Marion County ranks as the state's largest county in terms of both population and economic output. As of January 2006, the county's unemployment rate equaled 5.2%, compared with a 5.8% rate for the state and 5.0% rate for the nation. Recent building activity indicates continued economic strength, as countywide building permit values have averaged more than $1.9 billion annually since 1996 and underpinned a 5.2% annual growth rate in the library's tax base. The library's financial position reflects its limited operating risks. General fund revenues have increased 3.5% annually since 1995, with most of the growth attributable to gains in property tax receipts. Increased operational efficiencies and reduced operating support of capital projects held expenditure growth to 2.4% annually over the same period. Although the general fund experienced a shortfall in 2003 due to capital investment, reducing the ending balance to $3.8 million (10.6% of spending), spending restraints in 2004 and 2005 elevated the ending balance to $7.8 million (24.5%) in 2005. While audited 2006 results are not yet available, Fitch expects the library will produce a modest surplus in the general fund. The library's debt levels represent a comparatively low $155 per capita and 0.3% of market value, reflecting the library's historical use of operating funds to finance capital projects. The central library project has received support from the Lily Endowment ($25 million) and the Library Foundation ($20 million), which together represent 44% of the original project cost. Once the central library project is complete, capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. will moderate. Including the debt of overlapping taxing entities--primarily local school corporations--increases overall debt figures to $3,988 per capita and 8.0% of market value. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion