11/7/11 1:22 PMFitch Ratings | Press ReleasePage 2 of 3http://www.fitchratings.com/creditdesk/press_releases/detail.cfm?print=1&pr_id=729941
million of fund balance. If fully drawn upon, this would result in a still healthy unreserved fund balance of 9.8% of budgetedspending. The adopted budget for fiscal 2012 includes a 3.5% mill rate increase which will generate an additional $6.7 million tosupport expenditure increases in education ($1.1 million), pension costs ($2.4 million), debt service ($3.1 million) and employeebenefits ($0.4 million). The budget also includes $1.1 million for capital improvements and $450,000 for contingencies.Debt levels are low and are expected to remain so given the city's conservative debt policies, limited bonding plans andmanageable capital needs. Amortization is strong with nearly 70% of principal retired in 10 years. The city's fiscal 2012-2016 capitalplan totals $270 million, although the city expects actual capital spending to be lower as some projects will be scaled down or cancelled. The city has $18.6 million of authorized/unissued debt remaining as well as its annual $3 million allowance for non-referendum approved debt. The city plans on issuing approximately $40-$50 million of bonds over the next five years for city andschool projects and plans to go out for referendum in March 2012 for an initial $10-15 million issue.The city's pension funding levels remain strong. On an aggregate basis, the city's six pension plans are 94% funded, using the city's8% assumed investment rate. Adjusting for Fitch's more conservative 7% discount rate assumption, funding remains high at 85%.For fiscal 2012, the city's contribution for its pension plans increased to $7.8 million, up $2.4 million from $5.3 million in fiscal 2011,but still represents a low 3.6% of budgeted spending. Other post employment benefit (OPEB) liabilities are manageable. The cityhas prudently set aside $1.2 million in a reserve in anticipation of establishing a trust in the future.Contact:Primary AnalystKevin DolanDirector +1-212-908-0538Fitch, Inc.One State Street PlazaNew York, NY 10004Secondary AnalystStephen FridayAnalyst+1-212-908-0384Committee ChairpersonSteve MurraySenior Director +1-512-215-3729Media Relations: Cindy Stoller, New York, Tel: +1 212 908 0526, Email: email@example.com.Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, andtherefore, Fitch has been compensated for the provision of the ratings.In addition to the sources of information identified in Fitch's Tax-Supported Rating Criteria, this action was additionally informed byinformation from Creditscope, University Financial Associates, S&P/Case-Shiller Home Price Index, IHS Global Insight, Zillow.com,and National Association of Realtors.Applicable Criteria and Related Research:--'Tax-Supported Rating Criteria', dated Aug. 15, 2011;--'U.S. Local Government Tax-Supported Rating Criteria', dated Aug. 15, 2011.
Applicable Criteria and Related Research:
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