The Tauranga City Council has released its annual Standard and Poors credit rating which shows it has remained stable on A+/A-.
The rationale said the council's ratings reflected the view of the extremely predictable and supportive institutional framework benefiting local councils across the country.
The council's average cash operating surplus had remained at more than 20 per cent of operating revenues since fiscal 2011 and the report forecasted the after-capital account surpluses to average 2 per cent of total revenues from 2013 to 2017.
However it predicted the account to return to deficits after 2015 when the capital expenditure was expected to rise.
"Tauranga's debt burden is very high on a global scale and is constraining factor to its ratings... The proposed sale of Route K to the New Zealand Transport Agency at the end of fiscal 2015 should significantly reduce its debt burden if it eventuates."
The report predicted the debt levels to stabilize as the council continues to record high operating surpluses and capital expenditure focusing primarily on essential infrastructure.
Population growth in Tauranga was higher than the national average with relatively large numbers of retired people receiving fixed incomes from the government which could affect Tauranga's ability to raise rates.
Tauranga had one of the highest debt burden levels and one of the lowest debt service coverage levels among rated New Zealand local councils.
The report also mentioned the larger rate increase expected in 2015 compared to that in its 2012-2022 long-term plan (LTP), due to the new stormwater levy of 4.7 per cent.
The report noted Tauranga had a track record of under-spending in its capital program when compared to its 10-year LTP.
"On average this has been approximately 26 per cent between fiscal 2012 and fiscal 2014, saving some $55m in debt over this time."