County scores stellar Standard & Poor's appraisal
Leaders: Delaware County could save millions in interest thanks to decision
Standard & Poor's last week bestowed its highest long-term rating -- AAA/Stable -- to Delaware County.
"Franklin County has been telling themselves they're the only county in Ohio to be a AAA-rated enterprise," said county Commissioner Dennis Stapleton. "So that's nice. It is a big deal."
Standard & Poor's looked at several different economic indicators in the county to come to its conclusion, including the unemployment rate, county incomes, real-estate valuations and overall financial position.
"The average unemployment rate through the first 11 months of 2012 was 5.1 percent," analysts Errol Arne and Carol Hendrickson wrote in their report, "which is lower than the 2011 annual average rate of 6.1 percent. And these figures are materially lower than the state's average of 7.3 percent and 8.6 percent for the same periods, respectively."
County Auditor George Kaitsa also pointed to the county's strong and growing sales-tax revenues as a contributing factor for the Standard & Poor's rating.
"Our sales tax receipts were roughly $32 million in 2009 and rose to $43.8 million at the end of 2012," he said, "and that's important, because 58 percent of the county's overall revenues come from the sales tax."
The good news, Kaitsa said, keeps on coming.
"We haven't even seen Cabela's or Menards come online yet," he said. "Cabela's (in the Polaris area) and Menards (on U.S. Route 23 south of the city) are both expected to open this year.
"Cabela's expects to generate $1 million in sales tax revenue on $80 million in annual store sales," he said. "Menards should provide $438,000 in sales tax on sales of close to $35 million annually."
Real-estate transactions also have rebounded since the recession began in 2008, Kaitsa said.
"Conveyance fees (on real-estate transactions) topped $3.5 million last year -- the first time it hit that number since 2008," he said. "That's a strong statement about our real-estate market. We are the fastest-growing large county in the state."
The analysts also praised Delaware County's general fund surplus of $4.8 million in 2012, "which would increase the ending reserve cash balance to $21.7 million, or 32 percent of operating expenditures.
"The last audit (on Dec. 31, 2011) on a GAAP basis yielded a surplus of $7.2 million, which increased the general fund balance to $30.7 million. This equates to 55 percent of operating expenditures, which we view of very strong."
The AAA/Stable rating not only provides county commissioners and Kaitsa with bragging rights, but it will help save the county potentially millions of dollars in interest payments if it were to have to take out a loan for, say, a large construction project.
"It's nice to be in our position and to look strong going forward," Kaitsa said, "but the most important thing will be our lower rate to borrow money. That could conceivably save us millions of dollars in interest in the future."