OCEANSIDE — This July Oceanside received an AA+ issuer credit rating from Standard and Poor’s Rating Service, the second highest rating available.
“The receipt of the AA+ rating is expected to lower future borrowing costs for the city, and validates the effectiveness of the City Council’s conservative financial policies,” Michele Lund, city treasury manager, said.
The city requested its inaugural overall credit rating at the same time it refinanced city bonds. Lund said application for a rating is part of the city’s long-term debt refunding program.
The city’s AA+ rating is based on its strong economy, good financial policies and budgetary flexibility.
Oceanside has seen increases in medium household income and home sales, and decreases in its unemployment rate, much like the rest of the country.
Additionally city sales taxes were better than expected, and the city met budgetary goals without overspending.
Lund said the City Council’s decision not to spend reserve funds during the recession paid off in a good credit rating.
Another key financial decision City Council made was to use one-time money to reduce debt.
“The council made tough decisions, and helped move us to where we are today,” Lund said.
Councilman Chuck Lowery, who served in 2010 and was re-elected in 2014, said City Council “didn’t have any choice,” but to practice fiscal conservancy.
Lowery added despite changes in City Council members over the last six years, the city has kept a tight belt on spending.
He gave kudos to city employees for working within a reduced budget, and agreeing to pay into their benefits.
Lowery said City Council needs to proceed with prudence and limit spending to city operations and maintenance. He added extra funds should not be spent unless there is unanimous City Council approval.
“Finances look pretty solid, but we still can’t spend money,” Lowery said.
Councilman Jerry Kern, who has served on City Council since 2004, likewise said the city needs to keep spending down in the coming years.
Kern added a big hurdle that lies ahead for Oceanside and other cities is looming pension costs.
Kern gave credit to Interim City Manager Michelle Lawrence, and former city manager Steve Jepsen for overseeing city budgets that hold the line on unnecessary spending.