Las Vegas got a glimmer of good economic news this week: The city of Las Vegas Redevelopment Agency, which pushes economic development downtown, has a better bond rating.
Standard & Poor’s bond rating service increased the agency’s rating to “A,” up from BBB+. That’s the third-highest rating offered and means the agency “has strong capacity to meet its financial commitments” but is still susceptible to adverse economic conditions.
“The credit factor we were looking at was underlying value. It’s pretty stable,” said Le T. Quach, a credit analyst with Standard & Poor’s. “The tax base has been growing. There’s still development going on in the downtown area.”
The 3,900-acre redevelopment area includes downtown Las Vegas, the Las Vegas Boulevard corridor north of Sahara Avenue, and areas along Owens Avenue, Eastern Avenue and Martin Luther King Boulevard.
Property tax collections in the district were $10.2 million last year, up from $7.7 million the year before and $5.2 million the year before that.
The area has seen a string of development successes for the city in recent years, including new restaurants and nightclubs downtown, high-rise condos, the $11 million Union Park development now under construction and a long-sought grocery store for the historic neighborhood known as West Las Vegas.
For some projects, the redevelopment agency finances improvements such as streets, sidewalks, drainage and utilities, and uses the increased property tax revenue to pay for the work. Since property values are holding, that revenue is seen as secure, Quach said: “We don’t foresee any huge declines in the future.”
A better bond rating reduces the cost of borrowing money for project improvements or low-income housing, City Manager Doug Selby said in a statement.
“The upgrade will save the RDA interest costs and enable it to maximize bond proceeds for vital projects,” he said.