The ratings on Sweden's Municipality of Sundsvall reflect our view of Sweden's stable and supportive local and regional government (LRG) system and the municipality's dynamic local economy. Sundsvall's strong financial performance and sound budgetary flexibility provide additional support for the ratings. These strengths are offset by Sundsvall's investments, which constrain the municipality's forecast balance after capital accounts, and somewhat high tax-supported debt. Sundsvall benefits from the Swedish LRG system's predictability, supportiveness, and a high degree of institutional stability. In addition, the country's fiscal policy framework promotes budgetary discipline through a balanced-budget requirement with which the sector is broadly compliant. The LRG sector's revenue and expenditure management is based on a far-reaching equalization system and autonomy in setting local taxes. Sundsvall's
