Moody’s Affirms City of Chicago Heights A3 Credit Rating

In June 2014, Moody’s Credit Reporting Agency affirmed the A3 credit rating to the City’s outstanding debt.

Since 2011, Chicago Heights has upgraded its credit rating by two notches, and Moody’s expects the City’s financial performance to continue to improve. This is good news for Chicago Heights, a city that is recovering from the financial pressures in the general fund incurred from fiscal years 2009 through 2011.

Within six months of taking office in 2011, Mayor David Gonzalez and Treasurer Jim Dee restructured the overall debt of the City and presented the City Council with a financial plan to balance a $2 million-per-year deficit.  The Council approved the plan with a 6-1 vote in December 2011.

Gonzalez and Dee, both certified public accountants, projected that the financial plan would not only balance the budget but also create surpluses in the next five years without major increases in the tax levy.  So far their projection was correct, and the City has kept the property tax levy under 2 percent for the past three years.  The Mayor and Treasurer’s proposed tax swap created a much-needed general fund reserve from bond refinance proceeds. Moody’s report called this a strategic move by the city.

The actual surpluses ended up exceeding Gonzalez and Dee’s expectations. The City produced an operating surplus of $3.4 million in 2012 and another operating surplus of $2.6 million in fiscal year 2013, according to Moody’s. 

The City has put good use to those surpluses over the last two years, removing over 1,200 dead ash trees, starting a tree trimming program and resurfacing more than 20 miles of residential streets. Gonzalez was pleased with Moody’s rating. 

“We have put a lot of effort and time into restoring the financial operations of the City,” Gonzalez said. “It’s important that we continue to reinvest those surpluses in our infrastructure, such as streets, water and sewer.  We knew going in (May, 2011) that we had a short amount of time to turn the finances around, and I very happy to see that we exceeded our original projections.”

Treasurer Dee is also pleased with the City’s surpluses over the last three years. 

“The City has been able to put millions of dollars back into the neighborhoods,” Dee said. “Rebuilding our infrustructure has been long overdue, and you can see the progress we have made in a short amount of time.”