County’s credit rating gets upgraded

Thurston County earned an Aa1 credit rating, an upgrade from its prior Aa2 rating, from a Moody’s assessment released on Thursday, December 1.

Moody’s, which provides information on the creditworthiness of borrowers, stated that the Aa1 issuer and general obligation limited tax rating shows Thurston County’s ability to repay debt and similar obligations without additional pledges, securities, or structural features.

An Aa1 rating from Moody’s means that the county is financially sound and that the county has enough revenue and cash reserves to pay its debts.

“The Aa1 issuer rating incorporates the county's robust financial position with very strong reserves that have kept pace with strong revenue growth in recent years,” Moody’s stated in its assessment which was initiated on November 3.

Robin Campbell, the assistant county manager, said during a public hearing on Monday, December 5, that this was good news for the county.

“Some of the things that Moody’s noted was strong growth even in light of a potential softening of the economic cycle, strong fund balances, strong financial management, and conservative budgeting,” she said.

Moody also attributed the county’s financial position to significant growth in tax revenues, an influx of Covid-19 relief funds, and the county’s “prudent spending practices.”

The assessment mentioned that Thurston’s Gross Domestic Product (GDP) growth outpaced the national rate by 1.7% over the last five years, driven by the county’s rapid population growth. Moody’s stated that the county’s population is likely to grow due to its lower cost of living compared to Seattle. Should population growth slow down, Moody’s noted that Olympia provides a stabilizing presence in the region.

Thurston County’s GDP per capita is at $166,000, which is projected to grow due to available land and strong demand for residential and commercial properties.

Moody’s added that the county’s leverage, or the rate at which it borrows to invest in assets, is relatively modest, with liabilities equal to 116% of total revenues in 2021.