This content was originally published by the Longmont Observer and is licensed under a Creative Commons license.
St. Vrain Valley Schools' long-term and underlying rating was raised on September 14th by S&P Global Ratings to an AA+ up from a AA on general obligation bonds.
In S&P’s analysis of St. Vrain's financial health they recognized the district’s large and diverse economic base, coupled with strong to very strong income indicators and access to the broad and diverse Denver/Boulder metropolitan statistical areas.
"We have benefited from tremendous community support and one of our highest priorities is to ensure the continued fiscal health of the district," said Greg Fieth, Chief Financial Officer of St. Vrain Valley Schools. "We have one of the strongest financial positions of any district in Colorado and through careful planning and strategic investments into our schools and programs, we have been able to continually elevate the quality of our schools and their greater impact on our community."
The S&P report also pointed out the district’s maintenance of very strong available fund balances, put together with positive general fund results in consecutive audited fiscal years. As well as its additional revenue flexibility through fixed mill levy overrides, which helps the district lower its reliance on state funding.
"The rating action also reflects the district's extremely strong tax base, which continues to grow through valuation increases and new construction," said S&P Global Ratings credit analyst Michael Parker. "Adding to the district's credit strength are two fixed mill levy overrides, which provide additional revenue as assessed value in the district increases. Finally, the rating action reflects the strong enrollment growth in recent years coupled with meticulous capital spending, allowing the district to capture additional students in the near term without any severe capacity constraints."
This AA+ rating action is based on S&P’s view of the district's very strong financial profile, continued trending enrollment increases in the growing St. Vrain community, strong financial management policies and procedures, and low overall debt as a percentage of district market value.
"Over the past decade, the district has worked to develop a consistent and strategic approach to sound investments and financial management. This includes conservative budgeting, spending that is focused on our vision and mission statements, and goals related to developing a strong fund balance," Fieth added. "All of these approaches have been integral to improving our ratings."
SVVSD plans to continue to be meticulous regarding its financial management policies and procedures. According to S&P, the factors limiting their ability to move up to a AAA rating are mainly external. One factor is the continued improvement of the economy. The second is the financial condition of the state’s pension system (PERA). It is not currently fully funded for 30 years. Last spring, the State Legislature passed legislation intended to improve PERA’s financial position.
