Newspaper article St Louis Post-Dispatch (MO)

Mound City Money

Newspaper article St Louis Post-Dispatch (MO)

Mound City Money

Article excerpt

From David Nicklaus' blog about St. Louis business. moundcitymoney

Moody's lowers debt rating of St. Louis * Moody's Investors Service has cut St. Louis' credit rating by a notch as the city prepares to issue $25 million in general-obligation bonds.

Moody's dropped St. Louis' rating from A1 to A2 on Tuesday, citing concerns about the "city's weak reserve and liquidity position, reliance on economically sensitive revenues and below- average wealth levels."

The credit-rating agency also assigned the city a negative outlook, citing "the potential for further deterioration of the city's financial position absent significant additional revenue growth or expenditure reduction."

St. Louis Comptroller Darlene Green said the city plans to issue $25 million in bonds to buy firefighting equipment and meet other essential needs. Generally, a lower credit meeting means the city would have to pay a higher interest rate on its debt.

"The city's strong fiscal management team has implemented a financial strategy to grow its reserves and diversify and increase its revenues," Green said in a statement.

Green said another ratings agency, Standard & Poor's, had reaffirmed its A-plus rating of St. Louis' debt.

Moody's, though, has downgraded St. Louis twice in less than 14 months. In August 2015, its downgrade notice cited the city's reliance on the earnings tax, which must be reauthorized by voters every five years.

An A2 rating from Moody's is still considered investment grade, and the company says the "A" tier implies average creditworthiness. (10.06)

Missouri rises to 15th in tax-climate ranking * Missouri's tax climate became a little more hospitable for business in the past year, according to the Tax Foundation.

The conservative-leaning group said last week that Missouri is now the 15th-best state for businesses, up from 17th place last year. Illinois' ranking was unchanged at No. 23.

The foundation's index includes corporate taxes and unemployment insurance premiums as well as individual income, sales and property taxes. It considers Missouri's corporate taxes the fifth-least burdensome in the nation, but ranks the Show-Me state 28th for individual income taxes and 24th for sales tax. …

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