By Antonio D. French
Filed Friday, June 02, 2006 at 6:55 PM
Comptroller Darlene Green's office today announced that the City of St. Louis' credit rating has again been bumped up. Labels: Comptroller, Mayor
Green said Standard & Poor's Ratings Service upgraded the city's credit rating from "A-" to "A with a stable outlook." Fitch Ratings and Moody's Investors Service also affirmed their "A-" and "A3" ratings, respectively, and raised their long-term outlooks from stable to positive on the city's $45.2 million of outstanding general obligation bond debt. General obligation debt is backed by the city’s property tax revenue and used mostly for public safety expenses.
A good credit rating lets the city borrow money at a lower interest rate resulting in decreased costs to taxpayers. This is the sixth credit rating upgrade for the City since Green became Comptroller in 1995.
Green, the City's chief financial officer, said the positive financial outlook shows that St. Louis is in a position to ask for more from potential developers.
"To keep our ratings at current levels and to raise them even higher requires greater fiscal responsibility now and in the future. The tax abatement and Tax Increment Financing that jump started our economy needs to be reduced now to ensure tax revenue will keep pace with the demand for city services," said Green.
Green has been at odds with Mayor Francis Slay on this issue. Slay has maintained that allowing developers -- especially downtown developers -- to pay no property taxes is in the best interest of the City because it encourages people to move downtown.
The Comptroller has suggested that the benefit be reduced to force developers and new loftbuyers to pay at least some -- maybe as much as 50% -- of the taxes they would normally owe so the City can keep up with expenses such as education funding, which comes primarily from property taxes.
Related Stories:
Comptroller and Mayor disagree on TIF's impact on schools
4 Comments:
This is the same wisdom as has been exhibited by the Federal Reserve's Open Market Committee: when we just get started going, let's throw on the breaks and slow it all down. While it can be agreed that some neighborhoods have had tremendous growth partially in thanks to the generous tax benefits offered not only by property tax abatement, but also available state and federal historical tax credits, other neighborhoods in the city are just starting to see that development. It might be most appropriate to, instead of across the board denials of tax abatement, or reductions of tax abatements like we've seen recently from 10 years to 5, to limit abatement to neighborhoods that have not received as much as others. Perhaps even setting thresholds, so that when a specific neighborhood exhibits a certain level of development, the available abatements are limited, again, rather than across the board. St. Louis is just starting to come back, let's not throw on the breaks across the board just yet, even if we need to limit some neighborhoods.
6/03/2006 12:27 AM
Travis,
Perhaps Ms. Green's plans for reduction in abatements and TIFs are in line with your suggestions. The downtown housing market is moving along and I doubt it would grind to a halt if taxes were not abated the same way it was done 4 or 5 years ago. The same cannot be said of every neighborhood showing signs of a comeback, like Old North and Forest Park Southeast. Let those neighborhoods that are teetering benefit from tax abatements and TIFs.
Ms. Green has done a wonderful job so far. From everything I've read and heard about her record, she really is looking out for the financial health of this city. I have to believe that she will use common sense about future development. But she is right that people don't need all the perks to move downtown this year that was needed 4 or 5 years ago. I think the mayor only listens to developers who naturally give their opinion that tax breaks are necessary, but I'm sure those same developers are reaping handsome profits.
6/03/2006 12:40 PM
I certainly agree with your comments, and mine were meant in no way as opposition to Comptroller Green or her efforts to build the coffers of the City. I wish there had been more details released with her comments so that we would know that this her proposals aren't intended to be across the board, but rather on a neighborhood by neighborhood basis. If so, then I'd be on board 100%.
6/04/2006 12:38 AM
Ms. Green speaks out well about saving the city money on general issues, but why doesn't tell us specifically where the tax increment financing needs to be cut. The people want to know what companies have reaped the greatest benefits from tax increment financing, and how much tax increment financing did these companies receive. Shine the light on the tax increment financing benefactors, and let the public know the truth. Ms. Green could show us what companies have benefited the most from tax abatements in the City of St. Louis, and the citizens would love to see it! If the Comptroller published a report on the City of St. Louis companies that received the most taxpayer funding, then this would slow down companies seeking tax increment financing and tax abatement! Call it the Green report and the taxpayers will read it. That would let everyone know that we have a Comptroller that is protecting the citizens of St. Louis, instead of general statements after general statements about the need for reduction in tax abatements and tax increment financing by companies! Be tough, Comptroller!
6/05/2006 1:15 AM
Post a Comment
<< Home