Fitch slaps 'AAA' rating on Wake County bonds

By Sarah Chaney of the Triangle Business Journal

With a hat tip to a solid mix of universities and overall strong economic health, Wake County was assigned a 'AAA' rating to $345.24 million public improvement bonds from Fitch Ratings.

The 'AAA' bond rating is the highest credit rating available to state governments. In order to raise money for large capital projects, government arms — schools and libraries, in this case — sell bonds on the public market, and receiving high bond grades helps keep interest rates low, a plus for investors.

Wake County has had several large projects in recent years financed via bonds. For instance, in 2013, Wake County voters approved $810 million in bonds for Wake County public schools. And in late 2012, they approved $200 million in bonds to upgrade and add facilities to Wake Tech Community College.

Fitch's positive outlook represents an intersection of several key factors. Wake County's expanding economy is evident in its professional and business services sector, which represents 20 percent of the regional Core Based Statistical Area. Other aspects driving the area's financial health are the well-educated labor force and skilled employment base, not to mention the county's median household income, which is 142 percent of the state's.

Other strong economic indicators Fitch pointed out include:

• Property tax revenue improved by 1.6 percent, and sales taxes increased $6.8 million for the fiscal year 2013;
• Fiscal 2013 net operating surplus was $20.6 million;
• Employment growth for the past year was 3.8 percent.