City of Park Ridge snags low-interest bonds despite downgrade

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Updated: February 2, 2012 4:10AM

The Park Ridge City Council on Jan. 18 formally awarded bids for the bonding of flood-relief projects totaling $5.4 million, and bonded another $2.1 million to cover payments related to an early-retirement incentive.

The interest rate for the sewer-project bonds is 2.3 percent, and the rate for the Illinois Municipal Retirement System bonds is 2.12 percent, according to the city.

The flood-relief bonds will pay for several proposed sewer-improvement projects recommended by an engineering firm that conducted a citywide study. Plans call for Phase 1 of the projects to take place during the next two years. The second phase will require the city to borrow additional funds.

The City Council tentatively approved the $7.5-million bond issue in December. Shortly after, the city learned that Moody’s Investors Service had downgraded Park Ridge’s bond rating from Aa1 to Aa2 due to the “deteriorating health of the city’s General Fund” and its support of other budgeted funds. Moody’s also assigned a “negative outlook to the city.”

Despite that, the interest rates for the bonds are “new lows” for Park Ridge, according to a statement released by the city.