By James Feichtner

With the growth of Fishers also comes progress. The city recently announced an upgrade in their financial standing through the Standard and Poor’s Rating Analysis. Formerly an AA rating, the city was bumped up to the status of AA+ in the SPRA of general obligation bond dept.

Fishers City Controller Oscar Gutierrez said that it couldn’t have come at a better time with the Federal Reserve raising its interest rates.

“We were a AA and then we went to a AA+,” Gutierrez said. “Why that is important is that the Federal Reserve (has increased) rates, so you have a generation of financial officers, treasurers, mayors over the last decade that have been able to enjoy money for free. The rates have been flat so you can borrow money for nothing through the Federal Reserve so the banks can have these really low interest rates. The only way for the city to continue to borrow at those low rates so that we can save money is to have a higher credit rating.”

Essentially, the SPRA is a measure of a city’s credit for bonds. With the borrowed interest rates rising, Fishers is still likely to pay a higher rate, but that rate would have been even higher had they not received their AA+ designation this year.

Now at their AA+ status, Fishers is one of the only cities of its kind in the state to have the status.

“We are technically the highest (rated) second class city in the state with a AA+,” Gutierrez said. “The highest third class city is Carmel with a AA+, and for a town; Zionsville has a AA+. Outside of those other two municipalities it is my understanding that there is no other with an AA+. That is for general obligation (debt), based on your tax revenue.”

Gutierrez said that the city’s successful economic growth helped it earn the AA+ rating.

“They grade you on the economy, management and budgetary performance; your cash reserves; several different things,” Gutierrez said. “The biggest factors for Fishers to upgrade were economic factors. What they do is they take your assessed value divided by the population and that gives you a number. That is your economic buying power. They look at your median income. So our median income went up and our assessed value went up based on our population. That was our biggest factor in getting a bump up; the economic factor.”

Despite receiving the upgrade to AA+ status, Gutierrez said that they barely missed receiving the AAA status, something no other Indiana municipality has earned. The city took all necessary steps to earn the rating, including establishing official policies for liquidity and investments, but the SPRA did not justify their capital improvement plan, also known as Fishers 2020, as completed as it had not yet been passed by city council.

“We do have capital improvement plan: Fishers 2020,” Gutierrez said. “They require a five-year capital improvement plan. We have a 20-year capital improvement, however, technically it hadn’t passed the city council so we don’t have one. So it is really a technicality. That’s what kept us from the AAA.”

Gutierrez said that with council passing Fishers 2020, he is confident the city will receive a AAA rating during the next analysis.

“(Standard and Poor) said that one they received the final product that has been reviewed and passed by the city council then we can go back out to them and get rerated,” Gutierrez said. “That would be next year sometime. We only do that when we have a general obligation long-term bond issued which we will have next year around the same time we did this year. Next year I project we will have our five-year capital improvement plan.”