Bond ratings indicate to investors the stability and safety of an investment. With higher ratings, investors are more likely to invest in county bonds. Orange County has sold $23.6 million in public improvement serial bonds.
The county’s finance commissioner, Kerry Gallagher, told The Epoch Times that although the county doesn’t rely on bonds to operate, it is a useful tool for spreading out the cost of long-term assets over time.
“The rating reflects the county’s robust reserve position, positive operations, limited debt burden, and economic metrics that are in line with national peers,” S&P said in its rating statement.
“Conservative budgeting and strict expenditure control underpin the county’s positive operating performance in recent years. Despite some slowdown in growth of the county’s sales tax (its main revenue), other revenues like investment income and its growing tax base, coupled with expenditure savings, have made up the difference.”
S&P cited the county’s recent industrial developments, growing film industry, and commercial investment as a marker of foreseeable positive growth. The steady population growth is also a big positive, according to S&P. It stated that the county grew to 411,948 in 2024 from 406,500 in 2022.
S&P also applauded not just the good financial management of the county administration but also the county legislature’s monthly review of budget results and finance department monitoring and its good debt policy.
Orange County’s 2025 budget is $987.8 million, and the county has a total debt of $225 million.
S&P did raise concerns about the size of the Other Post-Employment Benefits (OPEBs) that the county has to pay. The concern is due to volatile medical costs and an increase in the number of dependents. OPEBs represent the non-pension benefits given to retired employees.
Orange County Executive Steven Neuhaus said in a statement: “This reaffirmation of our AA+ rating is proof that Orange County’s strong financial foundation and smart, conservative budgeting are continuing to pay off. It sends a clear message that we are a stable, well-managed County that is budgeting, spending, and investing responsibly, today, and for the future.”
