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Credit Analysts Give Burnsville Good Rating, Negative Outlook

The City of Burnsville got a mixed report from Moody's Investor Service, which praised the city's "prudent management" but noted that the city's position could be imperiled by shortfalls at the Burnsville Performing Arts Center

Analysts at Moody's Investor Service gave the City of Burnsville a clean bill of financial health—with some caveats.

Last week, the organization (which assesses credit risk) affirmed Burnsville's previous rating, Aaa, for bonds issued in 2012 and the majority of the city's debt. Aaa is the highest possible rating on a scale which ranges from Aaa to C. One exception is an outstanding $5.4 million bond (lease revenue debt connected with the Ice Center) which was once again given a Aa2 rating. 

In a summary of Moody's report, analysts said the city's high rating reflects the Twin Cities metro's diverse local economy, the city's low debt burden and "strong financial position supported by prudent financial management." 

However, Moody's assigned a "negative outlook" to the city, citing "consecutive years of significant declines in taxable valuations, weaker demographic profile compared to neighboring peers, and modest enterprise risk posed by the city's Performing Arts Center." Analysts noted that Burnsville's rating could go down in years to come if the city's fund balances begin to decline or the expenses of the BPAC begin to put pressure on the city's general fund. The city could also face a credit downgrade if two trends continue unchecked: Declining property values and a less competitive socioeconomic profile could take the city down a peg or two. 

The city's outlook could improve to "stable" if the BPAC's finances were to become self-sustaining. Likewise, Burnsville could garner a better outlook if property values bounce back.

Phil October 20, 2012 at 10:30 PM
I've always felt that the BPAC needs to have more frequent performances whatever the genre and season of the year. Personally, I would enjoy seeing more professional concert-style musical talent that could sell out the 1000 plus theatre each time. A lot of performers even prefer smaller venues. I think that the public is hungry for great, celebrity talent and would pay the price to see them.
Phil October 21, 2012 at 01:04 PM
I've always felt that the BPAC needs to have more frequent performances whatever the genre and season of the year. Personally, I would enjoy seeing more professional concert-style musical talent that could sell out the 1000 plus theatre each time. A lot of performers even prefer smaller venues. I think that the public is hungry for great, celebrity talent and would pay the price to see them. Try taking a poll for the public to tell you who they would like to come and perform.

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