Wednesday, June 26, 2019 | 2 a.m.
The latest boost in North Las Vegas’ credit rating will be noticeable in the city’s finances, officials said, but residents will also see it in parks, libraries and other areas throughout the city. The upgraded rating will mean the city will be able to borrow money at lower interest rates, yielding millions in savings that the city plans to invest by restoring services that were reduced during the Great Recession.
Nevada’s fourth largest city recently earned an A-level investment grade six years after plummeting into junk bond status during the depths of the recession. North Las Vegas’ credit rating is now at pre-recession levels, said City Manager Ryann Juden.
“North Las Vegas has emerged even stronger,” Juden said. “Much stronger than what was inherited six years ago.”
S&P Global Ratings raised the city’s bond rating four notches from BBB to A-plus, and its general obligation bond rating three notches from BBB to A.
Last summer, Moody’s Investors Service boosted the city’s rating to Baa1, the eighth highest ranking in Moody’s long-term corporate operation rating. Last week, Moody's upgraded the city two notches to an A2 rating. The upgrade helped the city save more than $40 million in interest on general bond obligations over the next two decades.
Last week, the city unanimously approved an effort to refinance its water and wastewater bonds, which will save $460,000 in interest payments annually.
During the aftermath of the recession, the city cut approximately 50 percent of its staff positions, reducing the budget by $20 million.
Today, Juden said he wanted to use cost savings from lower interest rates toward city services.
“We are putting money aside to allow us to hire more staff,” Juden said. “What this does is translate directly to our citizens with an increase in services.”
Chief Financial Director William Harty said the city intended on hiring new staff in almost every department, improving the city's ability to provide library service, maintain parks and help residents with their needs at city offices.
“Adding staffing across the board will meet the needs of citizens,” he said.
Juden said council and staff were intent on securing the city’s financial health by maintaining a diverse set of revenue streams as well as only spending money that they know they’ll have long-term.
He said he also wanted to make sure the city didn't repeat past mistakes. In the past, the city used to hire staff with “non-recurring dollars” meaning, one-time revenue streams that fluctuate with the economy.
One example came in 2011, when an increase in home construction in North Las Vegas left the city with an above-average amount of revenue from building permits and utility hook-up fees. The city made hires based on that increased revenue, officials said, but the money vanished the next year when home construction returned to normal levels.
Juden said that when he joined the city in 2013, it was facing a revenue problem. To tackle it, the city worked toward attracting new employers as opposed to simply raising taxes on residents.
“We transformed the way we do economic development in North Las Vegas and brought in experts to attract more business,” he said. “With new businesses there was a new tax base, which diversified revenue streams should another recession occur."
Delen Goldberg, North Las Vegas chief of staff, said those efforts resulted in employers like Amazon expanding into North Las Vegas, helping diversify the city’s revenue streams so that it no longer had to rely as much on residential property taxes and fees.
Juden said the economic development activities had placed the city on a more stable financial foundation from which to replenish its staffing and restore its services.
“Now, we’re making sure when we bring on employees, we are hiring them with certainty that the money will be there next year and years to come,” Juden said.