April 24 (Bloomberg) -- Milwaukee, Wisconsin’s biggest city, plans to sell $217 million of debt next week after Moody’s Investors Service cut its rating, citing a declining tax base.
The municipality of about 599,000 along Lake Michigan is set to offer $107 million of general-obligation securities through competitive bid May 1, according to data compiled by Bloomberg. The city, home to Miller Brewing Co. and motorcycle manufacturer Harley-Davidson Inc., also plans to sell $110 million of short-term debt the same day.
Proceeds will finance public improvements and refinance debt, according to a sale notice.
Moody’s on April 9 lowered Milwaukee’s $811 million of debt to Aa3, three steps below the top, because of “weakened socio-economic indices.”
The city’s tax base valuation fell at an average annual rate of 4.2 percent in the past five years, according to Moody’s. The southeastern Wisconsin community should still remain the state’s economic center, Andrea Stenhoff, a Moody’s analyst, wrote in a report.
“Milwaukee benefits from a diverse economy that is becoming less reliant on manufacturing as employment in the health care and higher education sectors expands,” Stenhoff wrote.
Residents earn less than other Americans. The city’s median household income is $35,823, compared with $53,046 for the nation, according to U.S. Census data.
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