Meet the Canadian who developed a ranking system for all 3,141 U.S. counties

If nothing else the numbers are staggering – two million data points.

But that’s the outcome when you set out to the build the very first of its kind within the U.S., a ranking system according to social and economic factors its the three,141 counties in that country.

In all, the rankings, compiled in Canada, are based on 36 data inputs. There’s information on demographics; environment (including data on climate change and declarations of disaster); owning a home; real estate taxes; social indicators (including education and crime levels) and personal infrastructure (such as amounts of police and teaching.) That information originated from more than a dozen different government or government-related sources.

Known officially because the American County Review (ACRe), the job represents a lot more than eight months of toil by John McLean, who for the past 23 years had focused his attention on bond analytics, bond pricing and developing bond indexes, initially at Scotia Capital and many recently using the Toronto Stock market.

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“There are 36 different measurements employed for each county. We roll those up on the same weight basis, and that is the way you get the top ranking within the state and [then] in the nation,” said McLean who developed the product to help individuals and institutions make important living and investment decisions. 

McLean, that has filed a patent on his work, known as the past eight months a “labour of affection.” He explained he developed a pursuit a couple of years back when he became conscious of the information gaps that existed in the U.S. municipal bond market. The muni-market is huge C almost US$4 trillion outstanding C with lots of issues being carried out on a tax-exempt basis.



“It seemed that ratings on municipal bonds were often assigned but never reviewed or updated,” said McLean, who then set out to develop a unique and non-arbitrary risk assessment of issuers in the county level. (Apart from county government issuers, school boards, redevelopment agencies, school districts, and publicly owned airports and seaports also issue.)

News that the rating agencies “may not be along with their game, and may not be doing their best,” surprised McLean. “I always thought there was a better way, an easier way and a more frequent method to measure than [that done by the] rating agencies that is summary.”

In other words, he would concentrate on the U.S. municipal market by developing a better model, by providing better services but do it in a manner that is transparent and open.

“By looking at all the different economic and social factors, that are not interpretative, you receive a good picture of what’s going on,” he said. Such information might be employed for both of these individuals and corporations to create decisions.

“It works both ways,” said McLean. “It’s not just a case of attracting attention in investment because you are ranked high. You are trying to get more information in to the hands of people who make those decisions.”

So who is going to buy McLean’s product? The data providers – Thomson Reuters and Bloomberg – are a possibility as are commercial real estate investors; muni-bond issuers, investors and ratings agencies. Another possibility is to use the data to develop so-called Smart Beta bond indexes. Meantime users can acquire a free look at some data on the website www.acredata.com.

So what are the three top ranked counties with above 100,000 populations? Hamilton (Ind.); Sumter (Fla.) and Weld (Col.).

bcritchley@nationalpost.com