Moody's Investors Service said it has upgraded to Aaa from Aa1 the rating on the town of Jupiter, Fla.'s Series 2001 and Series 2005 general obligation bonds and affirmed the Aa2 rating on the town's Series 2002 sales tax revenue refunding bonds.
Both ratings have been assigned stable outlooks. The GOs are secured by the town's unlimited property tax pledge. The sales tax bonds are secured by the town's portion of the local government half-cent sales tax.
The upgrade to Aaa on the town's GOs reflects the town's favorable economic profile, large and stabilizing property tax base, low debt burden, significantly strengthened financial position and strong management.
The town's economy increasingly reflects a diverse, high value-added industry mix alongside a maturing, relatively affluent residential community.
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's low debt burden, low operating millage and recent reductions to fixed-cost budget components (health benefits and pensions) afford it considerable flexibility to manage additional potential challenges and maintain its sound financial position.
The Aa2 sales tax rating reflects ample coverage of maximum annual debt service (MADS), moderately weak legal provisions including a 1.25x MADS additional bonds test (ABT) and open-loop flow of funds, rapid amortization of principal, recently improving revenue trends following consecutive declines and a reserve account requirement funded through a non-investment grade surety bond provider, a moderate credit weakness that is balanced against consistently strong coverage levels and the town's substantial unrestricted general fund cash and reserves.