Whanganui District Council might have some big financial issues on its plate but global rating agency Standard and Poor's continues to give the council a AA- long-term credit rating.
Mayor Annette Main said the rating was a vote of confidence for the council's "prudent financial management, budget flexibility and transparency".
Ms Main said the rating also gives additional confidence to council's financial lenders and will mean more investor interest, leading to lower interest costs to the council.
AA- is Standard and Poor's fourth highest credit rating and is the same as the rating of New Zealand's major banks. The council's credit rating was anounced on June 10. It has also given the council a short-term issue rating of A-1+. This is the highest short-term credit rating, indicating the council's "very strong capacity" to meet its short-term obligations. She said while Standard and Poor's acknowledged the increase in the council's debt - due largely to the wastewater treatment plant upgrade and the capital expenditure from the June 2015 flooding event - it also commented on the benefits of preparing a 10-Year Plan which ensures it maintained a forward-looking approach to prudent financial management.
"The 10-Year Plan 2015-2025, which will be adopted on June 30, sees the council focusing on reducing our overall debt levels once the wastewater treatment plant upgrade has been completed.
"Apart from the years the plant is being upgraded, for every other year of the plan the council is budgeting on reducing its overall debt level. Standard and Poor's has advised that its outlook for the council is stable. This means it expects we will continue to operate within our forecasts, with the credit rating expected to remain in place for the next two years."