* Fitch Ratings lowered DuPage County’s rating to AA+, down from AAA, the first time in anyone’s memory that this has happened…
In a statement Sept. 2, released as the holiday weekend was beginning, Fitch said roughly $150 million in DuPage debt was a victim of revisions in its criteria for state and local governments.
“The downgrade reflects Fitch’s concern (about) the county’s limited revenue flexibility and slow revenue growth prospects,” the New York firm wrote. “(Fitch’s) revised criteria placed increased focus on Fitch’s expectations for the natural pace of revenue growth without revenue-raising measures and the ability of an entity to independently increase revenue.”
That concern appears to be in part due to extreme reluctance by the county in recent years to raise property taxes. It also reflects that the county now has little undeveloped land, with its population apparently plateaued at a bit under 1 million.
In general, Fitch said it expects revenue from existing taxes to grow “slightly below historical trends” and generally only in line with national inflation. “While sales tax revenue has growth between 4 percent and 5 percent annually over the past several years, it has slowed to only 1 percent growth in fiscal 2016, leading the county to change its growth assumptions going forward to only 2 percent growth.”
In a statement back, DuPage Chief Financial Officer Paul Rafac emphasized that the county still is AAA in the view of Standard & Poor’s and Moody’s ratings.