By Russ Wiles and Caitlin McGlade | The Arizona Republic
Moody’s Investors Service on Friday downgraded several of Glendale’s credit grades, affecting more than $700 million worth of bonds, as the rating agency expressed concern over weak management practices and the city’s lingering financial exposure to the Phoenix Coyotes hockey franchise.
Moody’s cut Glendale’s GOULT, or General Obligation Unlimited Tax rating, to A3 from A2, affecting $163 million worth of outstanding bonds. The city’s rating on $254 million worth of senior-lien excise-tax bonds also got cut to A3 from A2, while the grade on its subordinate-lien excise-tax bonds, worth $213 million, got trimmed to Baa1 from A3.
The city’s transportation excise-tax and street/highway user revenue bonds both got trimmed to A3 from A2, representing $99 million of bonds combined.
All of the Glendale ratings remain in the superior “investment-grade” category, though the Baa1 mark is getting closer to “junk,” or speculative, status.
The downgrade does not immediately cost the city, although it would impact the interest rates the city must pay on future borrowing.
Related: Attorney General’s Office may probe Glendale finances
