Dorchester County Receives Upgrade, AA+ Rating for General Obligation Bonds
On February 24, 2022, Dorchester County received an S&P Global Ratings boost from ‘AA’ to ‘AA+’ for the county’s Series 2022 General Obligation (GO) bonds. Periodically, and in all circumstances when bonds are issued to finance various projects, the county undergoes a review with rating agencies that evaluates the organization’s credit risk and overall financial condition. The results then can impact the capacity to fund capital projects and in this case, with lower interest rates.
According to the S&P Global Ratings Summary for Dorchester County, “The one-notch upgrade reflects a combination of sustained strong financial performance as well as continued strong growth in the county’s tax base...”
The higher rating was primarily based on the following:
- Large, strong, diverse tax base that continues to grow rapidly, spurred by strong growth in the Charleston-North Charleston metropolitan area;
- History of strong financial performance, consisting of years of strong positive budget-to-actual variances, resulting in significant increases to available reserves that now approach close to 57% of operating expenses;
- Comprehensive set of formalized financial policies and practices and a strong institutional framework score; and
- Manageable fixed costs despite ongoing capital needs associated with a growing economy as well as a below-average pension funded ratio.
County Administrator Jason Ward said, “Having this bond rating upgrade will allow the county to continue lowering the cost of borrowing as we implement the quality-of-life projects that were approved by voters through the parks and libraries referenda. This is an important milestone for Dorchester County!”
Dorchester County Council Chairman Bill Hearn added, “S&P’s upgrade is a testament to Dorchester County’s financial stability and continued economic and residential growth taking place in our area. I appreciate our administrative team who are committed to strong fiscal and budgetary policies and practices. Together, we all have worked hard to improve our financial standing so that we can save taxpayers money while continuing to invest and make improvements within our community.”
As a result of this upgrade, Dorchester County now holds the second highest credit rating available to public entities from both Moody’s and S&P. Only five other counties in South Carolina are rated higher.