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North Bay's credit rating improves.

The City of North Bay reports Moody's Investment Service published its most recent debt rating for the City of North Bay for the year 2009.

The new rating of Aal reflects an increase of five notches in the rating since 2002 when the city's debt rating was A2.

North Bay has been successful in funding priority programs and infrastructure, while recording strong financial outcomes and maintaining a solid balance sheet with adequate liquidity.

In a news release, the city said stable municipal operations contributed to surpluses in 2008 and 2009. However, in 2009 lower transfer payments from the federal and provincial governments for capital and through the Ontario Municipal Partnership Fund put pressure on operations. Overall, the city's generally positive operating outcomes should support pay-as-you-go capital financing and help North Bay limit the accumulation of debt to finance capital projects.

While North Bay reported it faces pressure from lower government funding and potential increases-to personnel costs, it is expected that the city will manage these cost pressures successfully and continue to post stable results.

North Bay's debt burden remains low in the Canadian context. Total debt service costs as a percentage of total revenues were 6.7 per cent in 2009. In Moody's opinion, this relatively low debt servicing cost adds to the city's fiscal flexibility.
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Title Annotation:IN BRIEF
Publication:Northern Ontario Business
Date:Mar 1, 2011
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