Quote:
Originally Posted by ldoto
A great credit rating means London city hall can invest and plan growth for the future during what is expected to be one of the most challenging years ever, municipal politicians say.
Moody's gave London city hall an AAA rating again for 2008 -- the highest possible rank, which gives London the best available terms for borrowing and lending.
"We can make some significant investments to get the economy going again" in the face of the economic downturn, Deputy Mayor Tom Gosnell said yesterday.
"One of the reasons why we have low operating costs is that our police, our other services are so efficient," he said.
"This demonstrates that we are managing well."
London has maintained its AAA rating for decades, despite a borrowing binge from 1999 to 2003.
Mayor Anne Marie DeCicco-Best said yesterday the rating "sends a signal out to those who want to invest here that we are a great place to make those kinds of investments. We use these kinds of ratings to sell London, definitely."
Borrowing for big-ticket projects drove the amount of debt issued as of 2004 to 58% of city hall's revenues. but that figure had been reduced steadily since under the stewardship of city finance chief Vic Cote.
As of the end of last year, debt issued had fallen to 41.6% of revenue.
"The city has always had a great track record of being financially prudent. We could always do better, but in comparison to the other borrowers we're doing really well," Gosnell said.
"(The debt rating) is supported by a prudent, conservative approach to fiscal planning," Moody's wrote in its report.
Those practices include capping how much the city will borrow each year for public works and following five-year plans to create more predictable and manageable cash flows.
When she met with Moody's this year, DeCicco-Best said the organization had "no concerns" about what the city was doing.
"Particularly in this day and age, when other municipalities aren't doing as well, it's great that we are maintaining this rating," she said.
"I think it's fantastic because even in these economic times, the plan to keep our costs in check and to continue to keep our debt low has worked out."
London's debt burden is roughly in line with the median of Canadian municipalities rated by Moody's.
Between 2003 and 2008, revenue at city hall has grown at a faster clip than expenses -- 6.9% compared to 5%.
In 2008, city hall spent 26.2% of its money on social and family services and 20% on public safety, including police and fire.
The most recent Moody's report examines 2008 and doesn't measure the impact of the global recession -- London's unemployment rate has since grown from 7% to 11.1%, the second highest in Canada.
But Moody's analysts predicted the recession wouldn't greatly affect the bottom line at city hall since most of its revenue comes from sources that don't vary with the ups and downs of the economy, sources such as property taxes and water and sewer charges.
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Oops... sorry, this story doesn't align with the prevailing dogma of the majority of posters at this site. Please remember the following protocol:
1) The City Of London is run by idiot politicians. How they tie their shoes every day is a mystery.
2) The mayor runs every operation down to the very last detail and is personally responsible for all failings.
3) The state of the public transit system is the most important thing in the entire city - bar none.
4) All municipal employees are incompetent, and as our esteemed university professor here calls it, they operate a "shithole". Perhaps they should all be shot.
5) All London private developments are dreadful. No exceptions.
6) All Londoners are whitebread, middle class zombies who are all, in turn idiots and not all all "progressive".
7) Anyone who posts any "good news" as the story above are liars, paid off, or incompetent (including Moodys). The fact on this site is that London is the absolutely worst place on Earth and is headed only downward from there. After all, total ignorance of how things are done is no reason whatsoever not to continue to bitch away at things without any foundation.
8) Do not discuss skyscrapers, or for that matter any other form of architecture - unless it is a negative comment on buildings that use concrete.
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