Town's Financial Standing Earns Higher Rating

After years of building a reputation for fiscal responsibility, the town of Clayton has been rewarded with an upgrade in its financial rating from A to AA by Standard & Poor's.

The upgrade, one of the town's top goals over the last few years, should bring a considerable savings in financing the town's long-term debt.

"We've been doing the right things, and it's great to see the town rewarded for it," said Councilman Bob Ahlert. "I think our town staff is to be applauded for their expertise and for doing things right. The Town Council deserves a pat on the back, too. We've had to make tough decisions along the way that haven't always been popular, something that isn't easy to do."

The upgrade puts Clayton into some elite company, among the few towns in the state with the highest rating a small town has received.

The rating agency, one of the world's most respected, said the upgrade was made "reflecting the town's expanding local economy, which underlies its consistently strong financial profile."

The agency listed four main reasons for the upgrade: "A stable local economy, anchored by its growing participation in the Raleigh-Durham-Research Triangle Park employment bases; Experienced strong tax base growth over the past five years that has provided management financial flexibility for capital spending: An overall strong financial position highlighted by the maintenance of very strong unreserved fund balance levels; and, A moderate debt burden with rapid amortization and a manageable capital plan."

Despite the economic turmoil that has gripped other regions of the country, the agency said it is confident the town will maintain its financial health due to its long and successful track record.

"The stable outlook reflects our expectation that the town will maintain its strong financial position as it both benefits from and manages the local economic expansion," the agency said.

Town Manager Steve Biggs called the upgrade "an important milestone" for Clayton, especially since the town is preparing to issue $7 million in bonds later this year to pay for street upgrades and more parks.

"Our residents will save money over the life of these bonds because of this upgrade, and that's something we can all be very happy about," he said. "This has been a long-term goal, and it has come about in a more timely fashion than we expected. A lot of that has to do with the leadership from our Town Council. The Council has done a very good job of making us be frugal when that has been the proper approach. They've shown the resolve to make the tough decisions when they needed to."

Another reason for the upgrade is the work of the town's highly lauded Finance Department headed by Award Winning Director Nancy Medlin, who has also been serving as Deputy Town Manager for the last few months. Medlin, one of the most respected government financial experts in the state, has won her profession's highest honor for Financial Reporting for the last seven years in a row. In addition, Town Auditor Kenneth R. Anderson told the Town Council recently that Medlin's department is doing "a great job. I think it's a well-run organization, with all the T's crossed and the I's dotted."

Medlin credited the town's strong financial position to "years and years of fiscal responsibility."

Mayor Jody McLeod  said the upgrade is "a great reward" for years of sound financial management.

"This is a great day for Clayton," the Mayor said. "But, this isn't a gift. This is something we've earned by doing the right things over a period of years. I'm happy to see that our efforts have paid off in a big way."

Clayton has a strong manufacturing base and serves as a hub for high tech industry, including several major bio-pharmaceutical companies. In fact, more than 10 percent of all North Carolina bio-pharmaceutical jobs are in Clayton. The town also boasts a strong construction industry, and a pro-business atmosphere. The economic diversity "was a big factor for us" in getting the upgrade, Biggs said.