Moody’s Investors Service on Monday upgraded Jupiter, Fla.’s general obligation bonds to Aaa from Aa1, giving the town three gilt-edge ratings.
Moody’s rating boost affects $19.9 million of GO debt with a stable outlook. Moody’s also affirmed its Aa2 rating on $6.45 million of sales tax revenue bonds.
“The upgrade to Aaa on the town’s general obligation bonds reflects the town’s favorable economic profile, large and stabilizing property tax base, low debt burden, significantly strengthened financial position and strong management,” said analyst Moses Kopmar.
Jupiter experienced rapid population growth to 55,000 in 2010 from 10,000 in 1980. The 23-square-mile town, about 22 miles north of West Palm Beach on the east coast, is nearing build-out.
“The town’s economy increasingly reflects a diverse, high value-added industry mix alongside a maturing, relatively affluent residential community,” Kopmar said. “Town officials have actively managed expenditures and revenues not only to preserve, but also to significantly strengthen, the town’s financial position during a period of extended, substantial pressure on general operating revenues.”
The town has a low debt burden of 0.3% for direct debt, 2.8% for overall debt and a low operating millage at 2.51 mills in fiscal 2011.
With low debt and low millage as well as recent reductions of fixed-cost budget components such as health care benefits and pensions, Jupiter has “considerable flexibility to manage additional potential challenges and maintain its sound financial position,” Kopmar said.
Jupiter’s GO bonds have been rated AAA by Fitch Ratings since February 2011 and by Standard & Poor’s since November 2010.