Elmhurst Has 'Very Strong Management': Rating Agency

Elmhurst IL

15 April, 2021

9:12 AM

Description

ELMHURST, IL — Elmhurst's pension liabilities are large and its tax collections down, but a rating agency still judges the local government as strong financially. Standard and Poor's Global Ratings late last month kept its top long-term rating of AAA for Elmhurst. It said the city has "very strong flexibility," gets little or no federal aid, and does not depend on federal employment. During the pandemic, the city has seen a drop in tax collections for such things as hotel and parking system revenue, the rating agency said. But it continued to experience growth in the residential, retail and industrial sectors, although not as strong as previous years, the ratings agency said. Standard & Poor's report labeled Elmhurst as having "very strong management, with strong financial policies and practices." The report said the city's pension obligations are large, but the city has maintained funding of its police and firefighters' pensions at higher levels than many towns in Illinois. As of Dec. 31, 2019, the firefighters and police pensions were 67 percent and 62 percent funded, respectively, according to Standard & Poor's. As for the Illinois Municipal Retirement Fund, the city is 84 percent funded. Most towns have high funding rates for IMRF because the fund can sue towns that fail to pay required amounts. Because of the city's home rule status, Standard & Poor's said it believes the city will have the flexibility to manage the potentially higher pension costs. Standard & Poor's long-term rating of AAA was for the city's 2021 series of $9.6 million in general obligation bonds. With such a high rating, the city can issue new bonds and refinance existing debt at the lowest possible interest rates, officials said recently. According to the city, only 30 of 310 rated towns across Illinois have an AAA rating.