Late Audit Could Further Erode Mount Pleasant's Credit Rating

Even with a first draft of the 2011 audit complete, Mount Pleasant could still see its credit rating dinged or even disappear.

According to the Moody's Investor Service website on Feb. 22, the village is on a list with 39 other communities across the country in danger of having their credit ratings lowered or eliminated altogether.

Currently, Mount Pleasant sits at a rating of AA2.

All told, there's $354 million in outstanding debt from the various locations. Moody's says the list is compiled of communities whose direction is uncertain because certain financial documents are missing. For Mount Pleasant, that undoubtedly meant the 2011 audit, which is seven months late from the deadline of July 31, 2012.

Here's what Moody's posted on its website:

The review is prompted by the lack of sufficient, current financial information. If the information is not received over the coming weeks, we will take appropriate rating action which could include the withdrawal or lowering of the ratings.

Trustee John Hewitt sits on the Finance/Legal/License committee and said he didn't know if there any been any word from Village Hall about the Moody's report. 

"I am not aware of any communication about this issue," he said.

Patch also reached out to Trustee Harry Manning, chair of the FLL committee, but we were unable to reach him over the weekend.

Having its bond rating eroded further or eliminated could impact how the village conducts its business, including whether or not it can borrow to tackle road projects with larger price tags.

Not having the audit completed on time has already cost the village $250,000 over the last two years in state transportation aids. While trustees didn't budget with those funds so there isn't a hole in the budget to fill, that is aid that can't be applied to necessary roads projects, potentially impacting the village's ability to effectively address necessary infrastructure.

According to what trustees learned at the Jan. 28 Village Board meeting, the audit firm of Schenck, SC would complete the 2011 audit by March 14.

The firm has fulfilled its promise, Interim Administrator Tim Zarzecki confirmed Monday, and the audit is expected to be addressed at the March 25 board meeting. 

"The 2011 audit is complete and we expect it will be in our hands by end of the week," he said in an email to Patch. "It is scheduled to be presented by the firm to the Village Board on Monday, March 25th at the (Village Board) meeting."

Now that the 2011 audit is completed, it is unclear if Moody's will remove Mount Pleasant from their list of uncertain communities, confirm or reduce the village's credit rating or perhaps a combination of the two.