Mayor Cooper today announced that Standard and Poor’s Global Ratings (S&P) has upgraded Metropolitan Nashville and Davidson County’s General Obligation debt to AA+ rating. This upgrade marks the first upgrade Metro has received from S&P in as far back as Metro’s records show (to 1981). The S&P upgrade to AA+ serves as an independent acknowledgment of the financial accomplishments Metro has made to stabilize its finances. Credit ratings are a key factor in determining the interest rate Metro pays on its infrastructure borrowing.
“A successful city requires strong finances. Just four years ago the State Comptroller cautioned that Metro’s financial status was unsustainable and warned of a State takeover,” said Mayor Cooper. “My administration made Metro’s financial health a priority and I am pleased to see others acknowledging our ongoing efforts. Now, Metro is financially stable, has a structurally balanced budget and enjoys the largest reserves ever. I would like to thank our Finance Director Kelly Flannery and all of Metro Council for finding efficiencies and implementing and codifying structural solutions while also making historic investments in our schools, public safety, parks and transportation infrastructure.”
“S&P’s decision to upgrade our bond ratings is external affirmation of our ongoing efforts to stabilize and strengthen Metro’s financial position and is verification that Metro has turned its finances around,” said Finance Director Kelly Flannery. “Our finance team has done great work, and we are confident with the continued support of Council we can build on this trend.”
In making its decision to upgrade, S&P acknowledged the implementation of a fund balance policy and long-term forecasting practices. The S&P report stated that the reforms implemented since Mayor Cooper took office have led to “available general fund reserves in excess 30% of expenditures in fiscal 2022 from less than 7% in fiscal 2020.” S&P expresses confidence that recent policy changes will ensure that Metro’s improved financial position “will be maintained as a new mayor is elected later this year.”
“This is a great achievement for the citizens of Nashville and a long time coming,” said Budget and Finance Committee Chair Kevin Rhoten. “I would also like to thank my Council colleagues who have taken a thoughtful and responsible approach to Metro’s finances.
"Congratulations to Metro Nashville government for this significant achievement. This comes as a result of Metro’s focus on financial stewardship and its dedicated efforts to reduce its OPEB liabilities, build reserves, and address cash flow issues. Metro’s fiscal health has come a long way in the past few years," said State Comptroller Jason Mumpower.
“Thanks to Mayor Cooper, the last four years have been a financial turnaround for our city. This rating upgrade should give the private sector confidence that Nashville’s government is financially strong and poised to continue making the investments necessary to keep up with a growing city,” said Rob McCabe, Chairman of Pinnacle Financial Partners.
This upgrade comes two months after Kroll Bond Rating Agency announced it would rate Metro at AA+. Metro is now rated Aa2/AA+/AA+ (Moody’s/S&P/KBRA).