Standard and Poor’s Reaffirms Niagara Region’s “AA” Stable Credit Rating

Niagara Region continues to maintain its “AA” credit rating, with a stable outlook, according to an October 10, 2018 confirmation report released by credit rating agency Standard and Poor’s. 

The report indicates that Niagara’s budgetary performance has improved and is expected to continue to benefit from a supportive institutional framework, prudent debt and liquidity management practices and from sound financial management. However, these strengths are mitigated by its limited ability to raise tax revenues because of low household income levels and slow economic and assessment growth compared to similar municipalities.

Long-term plans present a good level of detail and are based on well-documented and realistic assumptions.  S&P praises the Region’s disclosure and transparency in the delivery of robust annual operating and capital budget documents which are shared with auditors and residents alike. S&P scored the Region with strong Financial Management, very strong Budgetary Performance, and exceptional Liquidity as well as a very predictable and well-balanced Institutional Framework.

The report notes, “We consider that the management team has adequate expertise in implementing policy changes. We expect no significant turnover at the senior management level in the near term, which we believe lends stability to management practices. Niagara has shown increased focus on long-term strategic and financial planning, which its financial policies support.”

A strong S&P rating enables capital works projects funded by debt, such as the costs of facilities, public works projects, Niagara Regional Police Service, Niagara Regional Housing, to be more cost effective for the Region and the taxpayer as well as our local area municipalities who borrow through us.

Niagara Region prides itself on being a strong partner to local area municipalities and plan to issue “about C$223 million in 2018-2020 on behalf of its lower-tier municipalities as well as to fund part of the region’s capital projects. We expect Niagara’s tax-supported debt, which as per our criteria includes both the region’s debt as well as the on-lent debt to its lower-tier municipalities, to increase to 80% of consolidated operating revenues in 2018 before declining to 76% in 2020”.

Niagara Region’s credit rating will be reassessed again in Fall 2019. 

Quotes

"S&P’s affirmation of Niagara Region’s AA rating speaks directly to the hard work of our dedicated financial staff. This strong rating highlights Regional Council’s ongoing work to keep taxes low, manage the Region’s finances in a fiscally responsible way, and exemplifies the Region’s ongoing commitment to growth as we lend financial support to important projects throughout our local municipalities."
~ Alan Caslin, Regional Chair
"Today’s report reflects that Niagara’s improved budgetary performance is a result of hard-work and a dedicated team of professionals committed to responsible management and budget planning on behalf of Niagara residents. Lower-than-expected capital expenditures, our organization’s financial framework, and prudent debt and liquidity management practices all contribute to this excellent result. Commissioner Harrison and our financial team work diligently to maintain high standards of disclosure and transparency throughout our budget process and this report reflects those commitments."
~ Carmen D'Angelo, Chief Administrative Officer, Niagara Region

Contact

Jason Lupish
Niagara Region
905-980-6000 ext. 3813
jason.lupish@niagararegion.ca


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