S&P lowers Iowa town’s bond ratings over arena financing
CORALVILLE, Iowa (AP) — A major financial rating agency has lowered its bond ratings for an Iowa town because of how it is financing a $70 million arena.
The Iowa City Press-Citizen reports that S&P Global Ratings pointed to Coralville’s bank loans with variable interest rates to pay for the planned 5,700-seat arena set to open in 2020. The arena would host the University of Iowa’s home volleyball games and concerts.
City leaders say they remain confident the project does not threaten Coralville’s finances.
S&P this month lowered its rating for Coralville’s general obligation bonds from BBB+ to BB+, making it “noninvestment grade.” The rating for bonds back by annual appropriations dropped from BBB to BB.
An S&P report said the city has a “heightened debt burden” and exposure to high interest rates.
Information from: Iowa City Press-Citizen, http://www.press-citizen.com/