Moody’s upgraded Hernando County’s Capital Improvement Bonds from A1 to Aa3. Moody’s explains that these bonds are “secured by the county’s portion of the state shared local government half-cent sales tax.” The upgrading was justified by “strong coverage and satisfactory legal protections.”
According to Moody’s, Hernando County’s strengths include:
-a sizeable tax base experiencing new growth
-positive financial projections moving forward
-modest debt with no expected borrowing
The challenges faced include:
– Slow economic recovery compared to state peers
-Inconsistent financial performance, resulting in significant reduction in General Fund balance and reserves
Moody’s points out that the reduction in General Fund balance from $37.4 million in fy 2008 to $18.7 million in fy 2013 was due in part to spending on capital improvement projects such as continued education programs and facilities including SunTech, Tampa Bay Advanced Manufacturing Skills Initiative, and Aviation and Aerospace Academy. There is an expected $2 million surplus in fy 2014 and the county expects another $2 million surplus for fy 2015 bringing the General Fund Balance to $23.1 million.