BRADENTON -- Until this week, Manatee County's Moody bond rating, which is like a credit score for government bodies, was A1. This is quite good. It means Manatee County bonds, especially bonds Port Manatee expects to issue to fund upgrades needed to take advantage of upcoming Panama Canal improvements, carry low interest rates compared to B or C-rated bonds or even bonds rated A2 or A3.
Going from A1 to Aa3, the change anticipated by Manatee County's finance director Dan Wolfson (who reports to Comptroller/Clerk Chips Shore), moves Port Manatee and Manatee County bonds from "upper-medium-grade" to "high grade," which means Moody's believes there is little risk involved in buying them.
$750 million for Port Manatee expansion
Borrowing costs change day-by-day and, especially in today's volatile financial climate, are nearly impossible to predict. Also, says Wolfson, "the larger the issue, the larger the effect on our borrowing costs" from the rating change will be.
Right now Port Manatee is engaged in a $750 million round of capital improvements, with another $750 million possible in coming years, mostly as a result of a massive Panama Canal expansion that is already under way.
$750 million is a considerable amount to spend, especially when much of it is borrowed money, so any interest rate relief is welcome. This is why, Wolfson says, it's important that Manatee County, with its excellent credit rating, "backs up Port Manatee."
In return for that backing and the spending it helps make possible, Port Manatee has a chance to score a good percentage of the millions of containers worth of additional cargo that will come through the Panama Canal after its improvement program is completed in 2014.
A 2006 study by consultant Wilbur Smith Associates pegged Port Manatee's total economic impact at over $2.3 billion dollars per year, and said the port helped create a total of over 20,000 jobs, numbers that have increased since then and are likely to keep going up in the future.
And, of course, every dollar the Port can save in bond interest can go into marketing and other activities that can create even more jobs, which makes even a one-step increase in Manatee County's bond rating important to our local economy.
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