By Jai-Leen James, Contributing Reporter
MIAMI BEACH, FLORIDA – Miami Beach received two high-grade marks on its 2019 general obligation bonds from Standard & Poor’s Financial Services and Moody’s Investors Service. Standard and Poor’s gave an “AA+” long-term rating and Moody’s assigned the city an “Aa2” long-term rating.
S&P acknowledged the city’s strong economy, management, liquidity, budgetary flexibility and budgetary performance. According to S&P, Miami Beach has one of the most devoted climate change strategies among local U.S. governments attempts to combat environmental impact.
Moody’s highlighted the city’s investment in raising sidewalks and streets. Also pinpointed was the city’s storm water infrastructure construction efforts and rising sea level prevention endeavors. Miami Beach’s largely tourism reliant economy, conservative budgeting and extensive institutional agenda score all contributed to Moody’s high remarks.
“I’m proud to see that our bond score rating has remained at this excellent score as a result of our proactive efforts in climate adaption and mitigation,” said Mayor Dan Gelber in a press release. “It is essential that we protect our tax base and financial standing by continuing to adapt and remain committed to our resilience policies and operations.”
Miami Beach Commissioners gave final approval last month to issue to the first tranche of the general obligation bonds approved by voters in November. 25 percent – or $117 million – of the $439 million G.O. bond is being used for sea level rise resilience. The bonds went to market this week.
The city plans to compete 57 projects with the newly acquired funds. The $439 million will be spread out over 10 to 12 years in four tranches, each being issued in about three-year increments. Tranche one is $153 million but Miami Beach will issue bonds for $185 million to refinance previous debt.
The city will spend the most on parks, recreational and cultural facility projects. The budget is not to exceed $87.7 million. The money will go towards improving playgrounds, beach walks, waterways, bay walks and appropriate lighting in these shared spaces.
“I am pleased that we have been able to maintain our strong credit ratings through our proactive efforts to reduce risk by investing in our aging infrastructure and adapting to climate change by using the best available science and knowledge,” City Manager Jimmy Morales wrote in a letter to the city commission.
“We must continue to act along these lines as climate resilience will continue to be a consideration for future ratings. It is essential that we protect our tax base and our financial standing by continuing to adapt and remain committed to our resiliency policies, programs, and operations.”
The city also has plans for several non-general obligation bond projects this year. $8.66 million has been allotted for the North Beach Oceanside Park renovation. Alsoin North Beach, a public plaza will be constructed for Rue Vendome near the fountain priced at $1.75 million. Fairway Park and Brittany Bay Park will undergo $1.27 million and $1.24 million renovation respectively.
Miami Beach also received high grades for its hands-on financial management practices and policies. $103 million from tranche two is anticipated to be released in 2022, $98 million from tranche three in 2025 and $85 million in 2028 from tranche four. The interest cost of the money bond is 3.49 percent for a thirty-year debt.