Moody's says it is downgrading Minneapolis bonds from AAA toAA1. Downgrading bond ratings increases the cost of borrowing for acity.
Economic development issuance has been significant and the heavyuse of tax increment financing by the city has resulted in taxincrement totaling about 15% of its base.
The current expansion of the Convention Center adds $204 millionof debt. Limited bonding is expected in 2002, but the majority ofthe $40 million in bonding for the new Central Library is expectedto be issued between 2003 and 2005. Other added issuance includes$69 million for flood mitigation projects through 2006 and $144million for ultrafiltration projects through 2007. Water and sewerrates are scheduled to increase annually over the next seven yearsin support of this major capital program.
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