Moody's Investors Service is giving Detroit City Council's newly minted 2020 fiscal year budget high marks for using "conservative revenue assumptions" and socking away $45 million in surplus revenue to fund post-bankruptcy pension obligations coming due in five years.

The Wall Street credit-rating agency said the $2.1 billion overall spending plan for the fiscal year that begins July 1 that City Council passed Monday is "credit positive" for Michigan's largest city — more than four years after it emerged from the largest municipal bankruptcy in U.S. history.

"The credit-positive budget reflects sound financial practices, including conservative revenue assumptions and long-range projections, a significant capital investment and continues to set aside funds for a scheduled pension cost spike in fiscal 2024," Moody's analysts wrote in a note published Thursday.

The budget plan adds $45 million to a $123 million trust fund Mayor Mike Duggan's administration created to help the city shoulder its bankruptcy court-ordered resumption of full pension payments in the 2024 fiscal year.

Under Detroit's bankruptcy plan of adjustment, the city was relieved of making full pension payments for 10 years while an infusion of cash from philanthropic foundations and the state of Michigan supports the city's underfunded pension systems.

The foundation and state contributions — which are expected to total $816 million over 20 years — were the basis of the 2014 "grand bargain" that shielded the Detroit Institute of Arts' collection from being auctioned off to satisfy creditors and limited pension reductions that city retirees had to endure.

In 2024, Detroit's bankruptcy debt-shedding plan calls for normal pension payments to resume. Estimates for those payments have varied based on the current value of the city's police and fire and general retirement systems.

In 2017, Detroit set up the trust fund to "smooth" the pension cliff, allowing the city's budget to gradually absorb higher pension payments, Moody's analysts said.

Moody's analysts have previously given the Duggan administration plaudits for creating the trust fund, which has been dubbed the "retiree protection fund."

"The fact of the matter is, in years past that long-term outlook was not as much of a focus," said Dave Massaron, the city's interim chief financial officer.

Moody's rates Detroit's credit at Bb3, three notches below its investment grade rating.

Detroit's $2.1 billion overall budget for the 2020 fiscal yearn includes a $1.07 billion general fund, Massaron said.

The Moody's report also noted Detroit has set aside $100 million of its fund balance for capital improvements of city infrastructure, risk management and demolition of blighted buildings. At the end of the 2018 fiscal year, Detroit had a $225 million fund balance, according to its audited year-end financial statement.

"It's gratifying that Moody's recognized the work the administration and City Council did together to adopt a budget that's built on sound financial practices," Massaron said.

Detroit's 2020 fiscal year budget reflects several top priorities for Duggan and City Council members, appropriating $3.6 million more toward affordable-housing projects and $7 million more for the Detroit Police Department for public safety measures.

The council also budgeted $5.25 million toward a three-year effort to remove 10,000 "dangerous trees" in neighborhoods where overgrowth has choked property lines and caused problems for utilities, according to City Council President Brenda Jones' office.