Metro's debt rating upgraded
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Photo illustration: Allie Carl/Axios. Photo: Leah Puttkammer/Getty Images
Mayor John Cooper celebrated Tuesday after the city's debt obligation rating was upgraded for the first time in at least four decades.
Why it matters: Fixing the city's finances is held up as one of Cooper's top accomplishments during his four years in office.
- "My administration made Metro's financial health a priority and I am pleased to see others acknowledging our ongoing efforts," Cooper said.
- Nashville's rating, which measures the city's ability to pay its bills and take on future debt, was upgraded to AA+ by Standard & Poor's Global Ratings (S&P). Cooper's office says it's the first S&P upgrade since 1981, which is as far back as the city's records go.
Flashback: Just before Cooper won the 2019 election, the city was put on notice by the state for dipping into its cash reserves too frequently. The state also had concerns about Metro using one-time land sales to balance its budget.
- Cooper frequently referred to the state's inquiry as a possible financial takeover, although others say a takeover was not imminent.
The intrigue: At a time when Nashville's relationship with the state has been frayed, Tennessee's top financial oversight official lauded the progress made under Cooper.
- "This comes as a result of Metro’s focus on financial stewardship and its dedicated efforts to reduce its [other post-employment benefits] liabilities, build reserves, and address cash flow issues. Metro’s fiscal health has come a long way in the past few years," state comptroller Jason Mumpower said in a press release.
Between the lines: While the city tapped into its cash reserves with much less frequency the last four years, the biggest boost to its finances came in the thick of the pandemic when Cooper and the council passed the largest property tax increase in Metro history.
- Metro Councilmember Bob Mendes, who previously chaired the budget committee, said praise should also go to former finance director Kevin Crumbo, who refinanced the city's outstanding bonds at substantially lower interest rates.
What we're watching: "Maintaining this positive financial trend will require the next mayor and council to have the political will to keep revenue in line with the expenses of our growing city," Mendes says, indicating another tax increase may be on the horizon.