2016 Bond Ratings

Type of Bond 

Standard & Poor's  Moody's 
 General Obligation Bonds  AA-  Aa2
 Utility Revenue Bonds  AA-  Aa2

The City issues debt in the form of bonds in order to finance long-term capital improvements such as streets,buildings, utility systems, etc. computers. The financed assets should also have at least the same useful life as it would take to repay the bond (e.g., a building would qualify, but a police sedan would not). Issuing bonds allows the City to meet infrastructure needs while paying for the assets as they are used. Because municipal bonds are typically tax-exempt, they usually carry a lower interest rate than other types of debt, and are therefore an attractive source of financing. 

The City uses two main types of bond financing: General Obligation and Utility Systems Revenue bonds. The ratings for these bonds are show above.

General Obligation (G.O.) Bonds are used to finance public safety, street, park, library, and storm sewer projects. They are repaid primarily through  secondary property tax, development impact fees, and sales tax revenue. G.O. Bonds are backed by the full faith and credit of the City.

Utility Revenue Bonds are used to finance gas, water, wastewater, electric, and solid waste projects. Utility Revenue bonds are repaid from revenues received from the customers of each particular utility.

FY 2016/17 Bonds by Project Category

 The City continues to place a high priority on infrastructure investment to attract and service future development. The links below provide more detail on recently-approved City bond programs:

2014 Utility System Bond Program
(En Español) [PDF]

2013 Public Safety and Streets Bond Programs [PDF];

2012 Parks Bond Program

Purchasing City of Mesa Bonds

Residents wishing to purchase City of Mesa bonds should contact a securities broker in order to purchase securities in the secondary market. City bonds are not sold directly to the public. Rather, bonds are sold in bulk in order for the City to receive the most favorable interest rate. 



At the end of fiscal year 2013 the City had total outstanding debt of $1.6 billion. Of this amount, $448.0 million comprises of general obligation debt backed by the full faith and credit of the City and $1.2 billion represents bonds secured by specified revenue sources (i.e., Utility System Revenue and Highway User Revenue). An additional amount of $7.0 million are special assessment and community facility district bonds where the City is contingently liable in the event that the assessment revenues are insufficient to satisfy the debt payments.
The Arizona Constitution provides that the general obligation bonded indebtedness of a city for general municipal purposes may not exceed 6 percent of the secondary assessed valuation of the taxable property in that city.
In addition to the 6 percent limitation for general municipal purpose bonds, cities may issue general obligation bonds up to an additional 20 percent of the secondary assessed valuation for supplying such city with water, artificial light, or sewers, and for the acquisition and development of land for open space preserves, parks, playgrounds and recreational facilities, public safety, law enforcement, fire and emergency services facilities, and streets and transportation facilities.
The City’s total debt margin available at June 30, 2013 was $166,050,240 in the 6% capacity and $253,349,502 in the 20% capacity.

Bond Rating

The City of Mesa's most recent bond ratings are as follows:
Type Standard and Poor's Corporation Moody's Investors Service
General Obligation Bonds AA- Aa2
Utility System Revenue Bonds AA- Aa2

Bond Descriptions

General Obligation (G.O.) - General obligation bonds are categorized into two groups. The two groups are:
  • 20% - Under Arizona law, cities can issue G.O. Bonds for purposes of water, wastewater, artificial light, open preserves, parks, playground, and recreational facilities up to an amount not exceeding 20% of assessed valuation, in this case, the secondary assessed valuation for Mesa.
  • 6% - Under Arizona law, cities can issue G.O. Bonds for all purposes other than those listed above (definition of 20% G.O. Bond), up to an amount not exceeding six percent of assessed valuation, in this case, the secondary assessed valuation for Mesa.
Utility System Revenue Bonds - Utility Revenue Bonds have no statutory limitations as to the amount of which may be issued. Projects that fall into this category are Gas, Water, Wastewater, and Electric projects. Bonds used for these projects are repaid from revenues received from the City's customers of that particular utility.


Office of Management & Budget
P.O. Box 1466
Mesa, AZ 85211-1466
480-644-5585 Fax

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