Alexandria has once again received the highest possible bond ratings from major credit agencies, marking the 33rd consecutive year the city has earned top marks for its financial management – news that City Manager Jim Parajon appeared to preview at a tourism industry event Thursday night.
S&P Global Ratings and Moody’s Ratings reaffirmed Alexandria’s ‘AAA’ and ‘Aaa’ ratings, respectively, allowing the city to continue securing low interest rates when issuing bonds for significant capital projects.
The announcement, made in a city press release on Thursday evening, came almost simultaneously with Parajon’s comments about upcoming financial news during Visit Alexandria’s annual meeting at the Hilton Mark Center.
“Last week we went to meet with the bond rating agencies to talk about the creditworthiness of our community,” Parajon told the audience of tourism industry leaders. “I don’t want to ruin the message, but stay tuned. There’s some good news, I think, coming.”
The timing of Parajon’s remarks and the subsequent press release suggest the city manager was referencing the positive rating reaffirmations, which he emphasized are increasingly rare achievements.
The trip to meet with rating agencies had been previewed by Mayor Gaskins during her monthly conversation with ALXnow on September 2, when she outlined the city’s financial planning activities.
“We will also be headed, myself, the city manager and the finance team and I will be headed up to New York City this month to defend our bond rating and to present to the bonding agencies kind of our strategy for the future moving forward and why Alexandria continues to be a AAA city and a good investment,” Gaskins said during the September interview.
“It’s critically important. And if you pay any attention to the newspapers, you know that not many people are succeeding in that endeavor,” Parajon said of maintaining high credit ratings.
Mayor Alyia Gaskins celebrated the reaffirmations as proof of Alexandria’s financial stability during uncertain economic times.
“At a time when we are grappling with economic uncertainty, Alexandria’s top ratings are proof that our city is on solid ground,” Gaskins said in the press release. “These reaffirmations show that our fiscal responsibility and commitment to community set us apart, and that Alexandria can serve as a model of stability and resilience for the region.”
In the press release, S&P Global particularly praised Alexandria’s “well-embedded, comprehensive policies that govern budgeting and reporting practices, and a culture of long-term planning.” The agency noted that it rates Alexandria “above the sovereign,” stating it believes “the City can maintain better credit characteristics than the U.S. in a stress scenario.”
Moody’s highlighted the city’s “diverse and affluent local economy”. They noted that Alexandria’s financial position is “robust and supported by strong formal policies and a long track record of conservative fiscal management.”
The strong credit ratings come as Alexandria celebrates record-breaking tourism revenue, which Parajon emphasized directly benefits residents through reduced tax burdens. At Thursday’s tourism event, he noted that visitor spending generated $88 million in consumption taxes for the city.
“$88 million in consumption taxes, you know, why is that important to me?” Parajon said. “That means that we can fund more books in the library. That means another teacher in the classroom. That means offering a little help to someone who has experienced being unhoused. That means just a little bit more that we can do for our community.”
The favorable bond ratings will support the city’s upcoming capital projects. Later this year, Alexandria plans to issue $105 million in tax-exempt general obligation bonds to fund infrastructure improvements, including the renovation of George Mason Elementary School, the next phase of the Waterfront Improvement Project, and initial work to renovate Alexandria City Hall.
Alexandria has maintained its top bond ratings since 1992, a track record that helps reduce borrowing costs for major infrastructure and community projects. The consecutive years of highest ratings underscore the city’s consistent financial management practices during both economic growth periods and challenging times.
The announcement caps a week of positive financial news for Alexandria, which also saw Visit Alexandria announce that the city has become a billion-dollar tourism economy for the first time, with visitor spending reaching $1 billion in 2024. Read ALXnow’s coverage of Visit Alexandria’s annual meeting.
