DALLAS -- Standard & Poor's Corp. said it affirmed its BBB rating on the general obligation bonds of the city of St. Louis and revised its outlook on the city of positive from stable.
In an announcement last week, the rating agency attributed the revision to the city's continued economic development, voter approval of sales tax increases, and expected revenue from riverboat gaming.
Standard & Poor's said the city's economy is stabilizing from previous downturns as it shifts from a manufacturing to a service-based economy. The city has invested more than $200 million in its downtown area during the past eight years, primarily in facilities for conventions, tourism, and transportation.
The planned start of riverboat gaming in 1994 and the upcoming move of Trans World Airlines headquarters to St. Louis from New York are expected to boost the area's employment figures and tourism industry, the rating agency said. The airline's move is expected to bring 1,500 more jobs to the city.
In addition, sales tax increases should provide financial flexibility for St. Louis, which has faced tight funds in the past, Standard & Poor's said. The increases were recently approved by voters and will go into effect in January.
Standard & Poor's officials have estimated the additional sales taxes should bring in $11.5 million annually for general city operations and $15.3 million annually for capital improvements.
Also, Standard & Poor's said, the city's debt remains manageable at $863 per capita.
