Finance News (Photo Illustration/MetroCreative)

PARKERSBURG — The City of Parkersburg has received a favorable rating from a credit rating agency as it prepares to finalize plans, including locations, for a new recreation center and fire station.

Moody’s Investors Service Inc. assigned the city an initial rating of Aa3 for its proposed issuance of up to $15 million in lease revenue bonds to fund construction of a replacement for Fire Station 3 and a new recreation facility planned on the site of the nearly 100-year-old City Park pavilion, according to releases from the city and Moody’s.

In the city’s release, Mayor Tom Joyce described the rating as a “best-case scenario” that exceeded initial internal expectations.

“I am particularly pleased that our conservative budgeting and expense management was specifically recognized by the rating agency in their assessment of our financial condition,” Joyce said.

A document from Moody’s said the rating “reflects the city’s strong financial position, which has seen steady improvement in recent years.”

Joyce cited the reduction of $35 million in liabilities, including police and fire pension obligations, and an increase in assets in the form of reserves and property and equipment by $27 million.

City Finance Director Eric Jiles said the Aa3 rating is “just two steps below the state of West Virginia.”

“We’re in great financial condition, to the point where we are considered to be a high-quality investment,” he said. Entities that purchase the bonds “can have a very high level of confidence that we are going to make good on those payments.”

Joyce said in the release the city’s finances have improved while still offering tax relief, including a quarterly business and occupation tax exemption approved in June 2022 that produced $879,000 in savings for affected businesses in fiscal year 2024.

The document from Moody’s notes another factor it considered was “the city’s weak economic profile with resident incomes that are well below-average at 64% of the national median, property wealth that is considerably lower than peers and lagging GDP growth.”

The bond issue is intended to fund a replacement for Fire Station 3, which was built during the Great Depression, and a 47,000-square-foot recreation center.

An ordinance authorizing the bond issue passed in August and included a provision transferring ownership of the properties where the new facilities would be built to the Municipal Building Commission. The commission would lease the sites back to the city, with the money it receives paying off the bond.

More than $4.4 million has been set aside for the recreation center project, with Joyce saying a newly established debt service fund would pay for the rest.

The ordinance did not specify the locations of the projects, although Parkersburg City Council voted over the summer to purchase a lot on Briant Street off Seventh Street for the fire station site.

The location of the recreation center has been debated since Joyce proposed replacing the pavilion in City Park with it in March 2023. Some residents and council members have questioned that choice, saying it could disrupt the park and the residential neighborhood surrounding it. Others support the plan, and Joyce has maintained the park is the best location, citing a feasibility study by Pickering Associates.

He said Wednesday there would be an item on the agenda for Tuesday’s council meeting to finalize the bonds for the fire station and pavilion replacement. City representatives previously said a supplementary resolution would be needed to specify the locations and the precise amount of the bond issue.

An agenda for Tuesday’s meeting is expected to be released this afternoon.

Evan Bevins can be reached at ebevins@newsandsentinel.com