Moody’s Downgrades Conservation District’s Credit Worthiness

The Pleasant Valley McHenry County Conservation District Visitors Center

The McHenry County Conservation District’s Pleasant Valley McHenry County Conservation District Visitors Center between Ringwood and Richmond.

I’m not aware of any intention of the McHenry County Conservation District to borrow any more money if it doesn’t get new permission to issue non-referendum debt through state legislation.

Certainly, such an attempt was made this year, but, after passing the State Senate without a “No” vote, House Sponsor State Rep. Mike Tryon did not advance either the tax hike with a referendum bill (Senate Bill 3342) or the money-borrowing-without-a-referendum bill. (Senate Bill 3341).

Nevertheless, Moody issued a statement last week that started out,

Affects $132.9M GO debt

New York, May 30, 2014 — Moody’s Investors Service has downgraded McHenry County Conservation District, IL’s outstanding General Obligation Unlimited Tax and General Obligation Limited Tax rating to Aa1 from Aaa. The Aa1 rating applies to $124.3 million of GOULT debt and $8.6 million of GOLT debt outstanding. The unlimited tax debt is secured by the district’s general obligation unlimited tax pledge which benefits from a levy that is unlimited as to rate or amount. The limited tax bonds are secured by the district’s debt service extension base (DSEB) levy, which is limited in amount though benefits from an unlimited rate. A negative outlook has been assigned.

Among reasons cited for the downgrade are

  • significant declines in assessed value
  • pressured property tax revenues
  • high debt as percent of operating revenues
  • limited revenue raising flexibility as property tax rates reach statutory maximums

I asked for details on the outstanding $132.9 million in bonds, but have not yet received an answer.


Moody’s Downgrades Conservation District’s Credit Worthiness — 12 Comments

  1. The County Board needs to show some common sense and quit passing bloated budgets which support unreasonable salaries and even a conservation police force!!!

    What do the Board members think MCCD is? BLM?

    Before we know it the budget will include money to support a MIRV?

  2. Fact: MCCD salaries are below collar county averages for comparable positions in forest preserve and conservation districts.

    Also, bond funds are capital funds and are separate from operating funds which include salaries.

  3. Fact: Senators Althoff and McConnaughay only “scheming” was trying to help a public agency do reasonable long range financial planning in light of the effect of the drop in EAV.

  4. Last time I talked to my Bond Broker pal, he called Illinois ‘Dog Snot’.

    Funny trade slang for the worst of the worst.

  5. This is a local district and for all republicans who criticize the state remember politics is local.

    Start protesting the raises given to teachers, police officers, firemen, administrators, etc and say we must live within our means. McHenry County already has some of the highest taxes in the nation and this is supposed to be a fiscally responsible county?

    McHenry just gave raises to the police and dispatchers.

    Is their pension fully funded?

    Don’t give raises until bills are paid.

    If people threaten to quit I am sure there are a lot of laid off professionals who wuld love their jobs.

  6. Long range planning must reflect budget reasonable to ask of people whose homes are taxed at 300% of national average.

    Mccd owns and controls the flow of capital on an eav it can never achieve again

    When property taxes are near 4% of property value, property values can only go lower.

  7. To learn about the bonds plug McHenry County Conservation District CUSIP ID 580818 in EMMA MSRB website, select an issue (start with most current issue), accept the legalese, and click on “Official Statement.”

    Track bond issues for all the taxing districts on your property tax bill.

    These are what’s known as municipal bonds.

    Bonds fall outside the tax cap.

    That’s why your taxes can increase more than the tax cap.

    A lot of special interest groups have been making a lot of money when taxing districts issue municipal

    Lucky taxpayers have bond debt at the municipal, State, and Federal level.

  8. I’m shooting in the blind here, but isn’t there a way to actually generate income from such nice facilities?

    Conferences, business meetings, things of this nature?

    I’ve never been in nor seen this facility but it appears well kept.

    I’ve said it before, I believe McHenry County is missing out on all of it’s God given nature and open spaces that could actually pull money from surrounding counties populous.

    I see folks from McHenry County and all over Chicago area driving just 120 miles or so, to golf and spend time in nature.

    My guess would be water usage could be a long term issue?

    I believe it’s possible the financial answers are looking us all right in the face everyday.

    Yet nobody seems to see it.

  9. Summary of bonds issued by McHenry County Conservation District since 1990.

    Series – Amount

    1990 — $01,600,000 — Land Purchase.
    1995A — $00,835,000 — Refunding Bonds.
    1998A — $20,330,000 — Land Purchase & Advance Refunding.
    1998B — $00,135,000 — Advance Refunding, Issuing Costs.
    2001A — $68,500,000 — Land Purchase & Improvement, Capitalized Interest, Issuing Costs.
    2001B — $12,235,000 — Advance Refunding, Issuing Costs.
    2005A — $58,825,000 — Advance Refunding, Issuing Costs.
    2005B — $01,315,000 — Advance Refunding, Issuing Costs.
    2007 — $73,000,000 — Land Purchase & Improvement, Pay Capitalized Interest, Issuing Costs.

    Data obtained from the Official Statements on the EMMA MSRB website.

    The above is principal only, not interest.

    The repayment schedule is known as the debt service schedule.

    Refunding is akin to refinancing.

    Sometimes taxing districts obtain additional money when refunding, just as homeowners sometimes obtain additional money when refinancing via home equity loans.

    Also certain types of limited bonds can have restrictions so they must fall within the tax cap? – not sure on that one.

    Quite a few golf courses are either not making much money or losing money since the 2007 – 2008 mortgage bond meltdown.

    DuPage County allowed landfills to operate in a few of their Forest Preserves for years – not exactly an environmentally friendly use of public land, especially if you are a neighbor of such a facility.

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