The city’s debt consists of approximately $1.7 billion in bonds and about $2.0 billion in other liabilities, particularly unpaid pension and retirement liability costs.
The city touts its S&P rating of AA- (Very Strong) and Moody’s rating of Aa2 (High Quality). However, when compared to other Valley cities, Mesa ranks near the bottom and is worse than average. In addition, a survey by Truth in Accounting ranks Mesa 45th among the 75 largest cities in the country for financial stability. Here’s a link to the the site where you can find the list and a pdf file describing Mesa’s D rating.
So, while the city isn’t in imminent danger, its ratings are substandard and in need of improvement.
At 7-1-18, this debt stood at $1.72 billion. There were no plans to present a 5-year projection of this debt, but upon my request city to provide me with details projecting this as follows:
7-1-18 $1.720 Billion
7-1-19 $1.803 Billion
7-1-20 $1.870 Billion
7-1-21 $1.924 Billion
7-1-22 $1.964 Billion
7-1-23 $1,997 Billion
These increases may be in line with inflation and population growth but do nothing to address the substandard situation that exists today. The graphs projecting debt and interest that the city has historically shown in its budget presentation only looks at existing debt and assumes no new debt will be issued. This has not been the case in a long-while, and with the city asking for another $195 million in bond issues this November and plans to issue another $65 million in excise bonds to pay for the first phase of a downtown ASU campus, there’s little reason to think they won’t be rolling over debt.
On top of the $25 million allocated to Mesa Plays in Question 4, Question 5 will allow them to seek another $55 million in debt down the road for additional fields and an arena. Regardless of whether these questions are approved, the city already has voter approval on $376 million of bonds that they haven’t issued. With a $918 million capital improvement program the city’s appetite for debt appears insatiable