The City of Kingsville’s bond rating was recently recalibrated by Moody’s Investor’s Service from an A3 investment grade to a higher A1 rating.

Moody’s Investor’s Service issues a bond rating as a measure of credit risk evaluation, and the process looks at all risk factors that can contribute to a city potentially defaulting in its debt obligations.

The two-notch upward movement of the city’s rating falls in the upper medium grade on Moody’s global scale.

Moody’s uses an investment scale of four levels ranging from the weakest securities, (Baa) to the highest (Aaa).

According to their scale, bonds that are rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations.

Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment sometime in the future.

Anne Burger Entrekin, Managing Director with First Southwest, the city’s financial advisor, said the A1 bond rating is an “acknowledgement of the management and financial strength of the city.”

Kingsville City Manager Carlos Yerena spoke of the successful rating in a press release Monday.

“The A1 rating is a to the city’s experienced executive team that has been together for several years,” Yerena said.

The executive team is comprised of the city manager Yerena, Finance Director Mark Rushing, and City Attorney Courtney Alvarez.

“The city commission’s leadership and sound financial polices were also a key factor contributing to the A1 rating for the city,” Yerena said. “Over time the city commission and staff’s continued efforts should provide additional cost saving related to the issuance of debt.”

Yerena also stated that the partnerships created with Texas A&M University- Kingsville, the Kleberg County Appraisal District, and the Kingsville Economic Development Corporation were a significant factor in ensuring that the city provided a positive economic report on the city’s economic environment.

“Dick Messbarger, Executive Director for the Kingsville Economic Development Corporation; Dr. Marilyn Fowle, Vice President for Business Affairs at TAMUK; and Tina Flores, Chief Appraiser for the Kleberg County Appraisal District, were instrumental in providing critical statistics identifying current and future economic development plans in the community,” Yerena said. “That information, along with research from the city’s Economic Development Department headed by Ken Clark, was highly beneficial to show a vibrant economic climate.”

Moody’s Investors Service is among the world’s most respected and widely utilized sources for credit ratings, research and risk analysis.

In assigning a rating for general obligation bonds the rating agencies assess the following factors: economy, debt structure, financial condition, demographic factors, and management practices of the governing body and administration.