(Source: Business Wire)
Fitch Ratings has assigned an 'AAA' rating to the $251.49 million general obligation bonds (GOs), series 2008 of Chandler, Arizona. Fitch also has assigned an 'AA+' rating to the city's $33.645 million excise tax revenue bonds, series 2008. Additionally, Fitch has affirmed its 'AAA' rating on the city's $231.2 million in GOs outstanding. Both series of bonds are scheduled for a competitive sale on Oct. 22. The Rating Outlook for both the GOs and excise tax revenue bonds is Stable.
The GOs are payable from an ad valorem tax levied upon all taxable property within the city, without limitation as to rate or amount. Proceeds of the bonds will be used to finance various capital improvement projects, including streets, parks, public safety and the water and wastewater utility. The excise tax revenue bonds are secured by a pledge of the city's excise taxes. Proceeds will finance water and wastewater utility improvements and refund a portion of the city's outstanding utility system revenue bonds for annual interest savings.
Both ratings reflect the stellar financial position, sound financial stewardship, below average debt burden, and diversifying economic base of the city. Although there is some employment sector and leading taxpayer concentration, the commitment of the primary employer in the city largely mitigates this concern. Residential building in Chandler has slowed dramatically over the past 18-24 months, as it has across the Phoenix metropolitan area. However, the slowing in Chandler also is attributable to the maturity of the city. Chandler expects to approach residential buildout within the next five to seven years.
Located in the Phoenix metropolitan area, Chandler has an estimated 2008 population of more than 250,000. The city has experienced dramatic population growth in recent years, more than doubling since 1990. Chandler is home to the high technology industry and manufacturing, with more than 75% of local manufacturing jobs in high technology. Intel is the leading employer with more than 11,000 workers, and Microchip Technology, Inc. employs nearly 1,500. Intel recently opened a new $3 billion wafer chip facility that adds 1,000 new technology jobs.
In addition to manufacturing, major economic sectors in the community include government, financial services, and healthcare. Employment outside the technology sector is led by Countrywide Home Mortgage, Wells Fargo Bank, Verizon Wireless, and Chandler Regional Hospital. Although they have been trending upward in recent months, city unemployment rates remain well below regional, state and national averages.
